BEIJING, Sept 14 (Reuters) – China’s Guangzhou Automobile Group (GAC) on Monday said it signed a letter of intent with another local automaker, FAW Group, to acquire part of FAW’s stake in an undisclosed vehicle-manufacturing joint venture through a share issuance, alongside a proposed supporting capital raise.
If completed, FAW is expected to become GAC’s second-largest shareholder with strategic influence, GAC said in a Shanghai Stock Exchange filing. GAC’s Shanghai-listed A-shares have been suspended from September 14 and the suspension is expected to last no more than 10 trading days, it said.
The target JV’s name is temporarily withheld because it involves an overseas-listed company, GAC said, adding that no definitive transaction agreement has been signed, and the deal remains subject to internal and regulatory approvals.
(Reporting by Xiuhao Chen, Yukun Zhang and Ju-min ParkEditing by Tomasz Janowski)
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