Beijing Auto to take over Fujian Daimler by Sept

Shanghai, July 30 (Gasgoo.com) After it failed in the bid for GM's Opel brand last week, Beijing Automotive Industry Holding Corp (BAIC) is focusing on a deal to buy a 50% stake in Fujian Daimler Automotive from the Fujian Motor Industry Group. The deal is expected to be finalized by September, the 21st Century Business Herald said today.

In recent years, Beijing Auto has been trying to diversify its commercial production and expand into the passenger vehicle market. The company has produced passenger vehicles mainly through joint ventures. The fifth-largest Chinese carmaker has never stopped its efforts to develop into a full-range vehicle producer by M&A (mergers and acquisitions).

Beijing Auto is looking to replace Fujian Motor as Daimler's Chinese partner in Fujian Daimler Automotive by taking over Fujian's 50% stake in the commercial vehicle venture. The other stakeholders in this JV are Daimler (34%) and Taiwan's China Motor (16%). Beijing Auto will restructure the venture after the takeover deal is inked in September.

The Fujian-Daimler facility, which was established in June 2007 in Fuzhou, provincial capital of Fujian, has been planned with annual output capacity of 40,000 vehicles. Output of Vito and Viano models is scheduled to commence later this year, while the Mercedes-Benz Sprinter production will start at the plant in 2010.

Beijing Auto produces vehicles through four subsidiaries, including two joint ventures (making passenger cars): Beiqi Foton, Beijing Automobile Works (BAW), Beijing Benz-Daimler and Beijing Hyundai. The company has said it will seek new opportunities to bid for or partner with other overseas automakers.