Dec 3 (Reuters) - Brilliance China Automotive, BMW's partner in China, said late on Tuesday its controlling shareholder would inject about 500 million yuan ($72.70 million) into the company in an effort to improve its liquidity and cash flow position.
The Chinese minibus and sedan maker said it would sell 1.314 billion new shares, or 26.36 percent of its enlarged share capital, at HK$0.43 apiece to controlling shareholder Huachen Automotive Group Holdings.
The issue price represented a premium of about 10.3 percent to the closing price of HK$0.39 on Monday morning prior to a suspension in the afternoon. Trading in the shares will resume on Wednesday.
Brilliance said the net proceeds to be raised would be used to reduce debt and contribute to the working capital of its 51 percent-owned joint venture Shenyang Brilliance JinBei Automobile.
"The subscription will provide the group with additional cash to strengthen its financial position, and to better equip the group in weathering through the current economic downturn," chairman Wu Xiao An said in the statement.
Huachen, which is wholly owned by the Liaoning Provincial Government, will increase its stake in Brilliance to 55.38 percent after the deal from the current 39.41 percent.
The share sale is subject to the controlling shareholder being waived from making a mandatory general offer for the outstanding shares of the company and approval from shareholders, Brilliance said.
