Guangzhou Automobile Group Co. may merge its GAC Changfeng Motor Co. unit into a venture with Mitsubishi Motors Corp., China Business News reported, citing an unidentified person close to Hong Kong-listed Guangzhou Auto.
Guangzhou Auto may take over the Shanghai-listed unit and delist it, the newspaper reported.
GAC Changfeng was suspended from trading yesterday after an announcement to the stock exchange that its biggest shareholder, Guangzhou Auto, was involved in price-sensitive discussions about the company. GAC Changfeng aims to resume trading Nov. 4.
Lu Sa, Guangzhou Auto board secretary, said in a phone interview with Bloomberg News today that the company is in talks with various parties about GAC Changfeng and no agreement has been reached.
Mitsubishi Motors President Osamu Masuko said in June the company plans to raise its stake in one of its two joint ventures in China to 50 percent by 2011. Currently, the carmaker has a 14.59 percent stake in GAC Changfeng Motor Co. and owns 25 percent of Southeast (Fujian) Motor Corp. Mitsubishi has not decided which venture it will raise its stake in, spokesman Kai Inada said today by phone.
