Shanghai Auto may sell holdings to listed arm
12 July 2006
Shanghai Automotive Industry Corporation (SAIC) may sell its auto-making holdings to publicly traded affiliate Shanghai Automotive in a deal worth US$2.5 billion, the Wall Street Journal reported. The move would be part of a major restructuring at the state-run car manufacturer that owns stakes in joint ventures with General Motors and Volkswagen AG. Shanghai Automotive will raise US$2.25 billion towards the acquisition by issuing 3.1 billion shares. The restructuring would concentrate SAIC's auto holdings into its main listed arm and give Chinese investors a chance to buy into the biggest domestic automaker in China. The move was announced in a filing with the Shanghai Stock Exchange on Tuesday.