GAC, Gonow to sign restructuring deal soon
April 20, 2010
Reportedly, Guangzhou Automobile Industry Group Co., Ltd. (GAC) has reached an acquisition agreement with Chinese minicar maker Zhejiang Gonow Auto Co., Ltd. and the contract will be signed in Hangzhou, the capital city of East China's Zhejiang province, on April 26 2010.
This is GAC's second restructuring in China after its previous acquisition of the Hunan Changfeng Motor Co Ltd. (Presently known as GAC Changfeng Motor Co Ltd.) The restructuring complies with the company's development thinking of consolidating its geographic advantage in the southern Yangtze River region so that it could benefit enormously from the country's adjustments to the automobile industry layout.
A source in the Gonow Auto said the acquisition is a matter of fact, but now the two sides speak with one voice on it that all information will be officially released after the conference on April 26. He also said the deal between GAC and Gonow is to cooperate but not GAC's whole acquisition of the Gonow. Now both sides have made detailed plans for the follow-up development of Gonow, which will be announced after the signing ceremony on April 26.
A long-time observer and industry insider of the GAC said GAC's restructuring Gonow, currently will not create true impact on its magnitude, which is mainly a strategy thought to consolidate GAC's geographic advantage in the southern region so that the company could take advantage of the country's adjustments to the automobile industry layout.