Brillance Auto looks to strategic investors to fund expansion

Shanghai. September 26 (Gasgoo.com) Brilliance Auto, one of China's biggest home-grown automakers, is exploring a variety of means of financing in order to meet its fast growintg money demand for output expansion, Chinese media reported today.

Brilliance auto needs to raise 6 bln yuan ($799 mln) to meet its huge financing demand for expansions.

The company's joint venture with BMW, Brilliance-BMW, which could produce 100,000 vehicles annually, has been preparing the construction of its second manufacturing plant. 

"In addition to Brillance-BMW's second plant, Brillance Jinbei is planning to build a 50,000-units assembley line," said Qi Yumin, president of Brilliance Auto.

To finance these two projects, Brilliance auto needs to raise 6 bln yuan ($799 mln), The 21 Century Business Herald reported today.

In April this year, Brilliance Auto worked out a couple of financing solutions, including listing in A share market, issuing new shares to BMW or attracting news strategic investors.

"Captial market will be a major vehicle for financing," Qi Yumin said. "Bank loan rates are too high," he added.

Statistics show that Brilliance auto sold 80,171 units Zhonghua sedans in the first eight months and its partner, BMW sold 10,000 units in the same period. The projected total sales of Zhonghua and BMW sedans will be about 130,000-140,000 this year and this number is very close to this company's total output capacity of 150,000 units a year.

Brilliance Auto lost 113.6 mln yuan (US$15.13 mln) in the first half of this year, according to the company's H1 report.