A year after Chinese automaker Geely announced the purchase of a nearly 10-percent stake in auto giant Daimler AG, a second carmaker from the People’s Republic is reportedly interested in acquiring a piece of the German company’s action. A stealthy accumulation of shares could already be underway.
According to multiple sources who spoke with Reuters, BAIC Group, Daimler’s Chinese joint venture partner, wants a stake of up to 5 percent to cement the two companies’ partnership. Following Geely’s big share buy, the Chinese company surprised many by offering to save the failing Smart brand by turning it into a joint venture. Daimler was only too happy to accept the offer. A new generation of Smart vehicles are set to roll out of China in 2021.
Daimler is likely already aware of BAIC’s intentions, with two of the three sources saying the company informed Daimler of its plan earlier this year. BAIC has also reportedly sought Chinese government approval for the share purchase.
One of the sources claims BAIC has already begun purchasing Daimler shares on the open market, slowly accumulating the desired stake of an automaker that has announced it will not issue new stock. It’s hardly an inexpensive task — to reach a 5-percent stake, BAIC would need to scrounge up roughly 3.4 billion dollars. [Read More]
Published @ May 11, 2019