Negotiation among Beijing Auto, State-owned Assets Supervision and Administration Commission and Changhe closes to end.
On 15 Oct, as reporter known from inner staff of Changhe that “Beijing Auto takeover bid has almost been decided now. They will sign the contract very soon. After Changhe divided from Changan China, the company wants to celebrate for it at first. But now it plans to have the ceremony with Beijing Auto.”
Xiongwu ZHAO, senior manager of Changan China senior manager of General Management Dept. told media on the day that government has approved equity alteration of Changhe. Asset in Jingde Town and Jiu Jiang belongs to Jiangxi Changhe, but Changhe Hefei belongs to Changan. Changhe becomes to local government-owned company from stated-owned company.
Xiongwu ZHAO stresses that “with the mark of government approve, main asset of Changhe has been altered already, and Changan has provided its best condition for Changhe alteration. But we have not joined the next takeover step of Changhe. So we have no comment for it.”
On 10 Nov, 2009, China Aviation Industry Group has divided its Hafei, Changhe, Dongan Power etc. auto asset to Changan Auto Group for 23% equity of Changan. After four years, the biggest asset reorganization pronounces a failure by Changhe divided out of Changan Group.
Staff of Changan told reporter that Changhe is not negative equity, but grows very stable and health. Changan planned to develop Changhe in the future, and expected a big sales improvement this year and next year. However, Changhe leaves Changan at this moment.
Changan has done three things for Changhe in the four year integration period. The first, it helps Changhe digest its historical debt. Secondly, it invests 700 million Yuan which supported by government into Changhe. Lastly introduce part of its mini car technology to Changhe.
Liuping XU, president of Changan Group, proposed a strategy for integration at that moment that “complementary advantages, win-win cooperation, realize our dreams, become one family”. However, self-protection conscious surround Changhe that the company wants to remain independent at purchasing, sales and even research. But asks Changan to provide capital and technology. Obviously, Changan will not take the idea. The final argue has turned to Changhe strike in Jan 2012.
The different from Changan and Beijing Auto is that Beijing Auto is willing to provide certain help to Changhe, and not position Changhe just into mini car segment. Beijing Auto even able to let Changhe develops its sedan and hatchback which is always Changhe’s dream. It probably the most important reason for Changhe chooses Beijing Auto at last.
The purpose of Beijing Auto takeovers Changhe is obviously. Beijing Auto wants to join “national team”, and exceed Changan and even FAW.
