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FAW plans to sell parts subsidiary

Joanne From www.gasgoo.com| July 19 , 2007 16:45 BJT

FAW Group Co., one of China's largest automakers, is planning to split its auto parts subsidiaries. While it is developing fast with its partners like VW, Toyota and Mazda, FAW intends to center on its core business.

Fawer Automotive Parts Co. Ltd., a wholy-controled subsidiary by FAW, was put on the market this Apr..FAW, the state-owned enterprise, got the nod from the government then to sell 55 percent of Fawer's shares with a hand still holding the left 45 percent shares.
   
"The ideal buyers could by world-class parts suppliers such as Bosch, Denso, Delphi or Siemens," said Rong Huikang, a representative of FAW's Beijing Liaison Office. According to other sources, FAW has got in touch with several overseas parts suppliers and China Wanxiang  Group.

It was speculated that this open offer is better to end with two none-SOE buyers. However, a foreign supplier who refuses to be identified revealed that FAW is mulling to sell the 55 percent as a whole.

Fawer has 23 affiliate companies under, of which fifteen are joint ventures with foreign auto parts suppliers like TRW, Denso. The products from Fawer cover many kinds of components such as transmission system and suspension system.

In order to concentrate on its truck and sedan business, FAW needs more capital to invest, said Paul Gao, from McKinsey & Co., a Beijing consult company. Besides cooperation with the international carmaker and auto parts suppliers, FAW also has its own brands---Hongqi sedan and Jiefang truck.

Up to now, there's still no final partner to join hands with FAW at Fawer. 

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