FAW mulls IPO, set to acquire Brilliance Auto

Shanghai, August 18 (Gasgoo.com) FAW Group, a booming Chinese auto-making giant who is seeking media publicity for its IPO plans, desires to buy out other carmakers, and now its attention has turned to neighboring Brilliance Auto, a Chinese partner of BMW, said sina.com today.

FAW insiders said that the corporation had a big profit growth in 2007 and its sales are expected to reach a new high this year amid the general slump in the Chinese auto market. Building upon this unique competitiveness and strength, FAW has decided to boost its media hype and IPO plans before acquiring some carmakers whose operations and prospects are not optimistic.

Brilliance Auto, located in Shenyang, capital of Northeast China's Liaoning province, has fallen prey to the further expansion of FAW Group headquartered in the neighboring Jilin province's Changchun city. The giant FAW aims to sell one million own-brand homemade vehicles in 2010, while Brilliance Auto currently has only annual sales of 300,000 vehicles of Brilliance Jinbei, Brilliance Zhonghua and Brilliance BMW brands combined together.

The acquisition of Brilliance Auto will greatly boost FAW's capacity and sales, and will add an important division to FAW. It is not easy for FAW to buy out and use the three Brilliance brands, but its IPO plan and the strategy of building up Chinese brands are likely to be well received by both the media and industry.