G.M. Is Said to Agree to Sell Stakes to China Partner

The New York Times reports on the sale of stakes that will make its Chinese partner the majority owner of the joint venture:

General Motors has reached an agreement to sell about half of its India operations and a small stake in its China business to its main joint-venture partner in China, people with a detailed knowledge of the transaction said on Thursday evening.

G.M. has become the second-largest automaker in China, mainly through a venture with the Shanghai Automotive Industry Corporation.

G.M.’s main partner in China, the Shanghai Automotive Industry Corporation, better known as S.A.I.C., suspended trading in its shares on the Shanghai stock market on Thursday pending an announcement, but declined to release details. G.M. said in a statement that it was constantly in discussions with S.A.I.C. on various issues, but also did not disclose any details.

[…] G.M. has become the second-largest automaker in China mainly through a 50-50 venture with S.A.I.C. that makes a wide range of G.M.-designed cars. Under the deal being completed, G.M. would sell a 1 percent stake in the venture to S.A.I.C., raising the Chinese automaker’s share to 51 percent, although G.M. would retain equal voting rights in company decisions and have an option to buy back the stake later, people with knowledge of the transaction said.

December 3, 2009, 11:59 AM
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