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China’s BAIC Aims to Buy Stake in Daimler
Chinese carmaker BAIC Group intends to acquire 4%-5% of Daimler AG as a way to defend its investment in the company’s Beijing Benz Automotive venture with the German carmaker, sources tell Reuters.
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Chinese carmaker BAIC Group intends to acquire 4%-5% of Daimler AG as a way to defend its investment in the company’s Beijing Benz Automotive venture with the German carmaker, sources tell Reuters.
The news service suggests the move is meant to balance the 9.7% stake in Daimler acquired last year by BAIC rival Zhejiang Geely Holding Group Chairman Li Shufu. In March, Daimler and Geely formed a 50:50 venture to take control of the German carmaker’s struggling Smart minicar brand.
Reuters says Daimler has assured BAIC that its Mercedes-Benz unit won’t form any new industrial partnerships with Chinese companies unless BAIC agrees.
BAIC first indicated an interest in acquiring a stake in Daimler four years ago. Reuters’ sources say the company notified Daimler and local Chinese authorities earlier this year that it would begin accumulating shares on the open market. Neither carmaker has commented.
Reuters says BAIC so far has not achieved a 3% stake, which would trigger regulatory disclosure under German law. A 5% stake would cost roughly $3.4 billion.