Guangzhou Auto set to buy Changfeng Motor

[mememe]

Guangzhou Auto set to buy Changfeng Motor

August 11, 2008


Shanghai, August 11 (Gasgoo.com) After long talks, Guangzhou Automobile Group is set to acquire Changfeng Motor by buying out the latter's shares by the end of this year, and meanwhile Mitsubishi Motors' loss-making operations in China are likely to get opportunities for recovery, said First Financial Daily today.

Reportedly, Guangzhou Auto will buy out and control Changfeng Motor, a Chinese partner of Japan's Mitsubishi Motors. The Japanese carmaker, who is now marginalized and losing money in China's auto market, will also sell some of its stake in the joint venture with Changfeng Motor to Guangzhou Auto for setting up a new venture. However, no one of them has confirmed this mode of cooperation yet.

According to an earlier report, the chairmen of Guangzhou Auto and Changfeng Motor flew together to Mitsubishi Motors' headquarters in Nagoya, Japan at the end of July, and this is seen as a sign that Guangzhou Auto's acquisition (of Changfeng Motor) and its partnership (with Mitsubishi Motors) will be clinched soon.

Guangzhou Auto aims to become China's fourth largest automaker and one of the world's top 500 companies by 2010. To achieve this ambition, mergers and acquisitions seem to feature prominently in its expansion strategy.

In Guangzhou Auto's current product lineups, the profit-making models are sedans and MPVs, mostly made by its joint ventures with two Japanese carmakers: Toyota and Honda. In the SUV segment, Changfeng Motor, 20% controlled by Mitsubishi Motors, has the capabilities and expertise to fill this gap for Guangzhou Auto.

Mitsubishi Motors, one of the first global carmakers that launched their operations in China, has not developed so successfully in recent years in the fast-growing Chinese market. Its prospective tie-up with the booming Guangzhou Auto is expected to boost this Japanese carmaker's recovery and expansion in the China market.

http://www.gasgoo.com/auto-news/7378...eng-Motor.html

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Guangzhou Auto acquiring Changfeng Motor.

May 13, 2009 - Guangzhou Auto is expected to announce its acquisition of Hunan-based SUV-maker Changfeng Motor on May 19 at the earliest, 163.com reported today, citing reliable sources.

An auto industry official of Hunan province in southern China recently confirmed the Changfeng Motor's close contact with Guangzhou Auto. On April 15 this year, when Changfeng's CS7 hybrid SUV rolled off the production line, an official of the provincial government also said that Changfeng Motor will be merged into Guangzhou Auto for restructuring.

Changfeng Motor builds Mitsubishi Pajero SUVs as well as its own-brand Liebao SUVs in Changsha city, capital of Hunan province. If the SUV-maker is acquired by Guangzhou Auto, which is one of the top five Chinese automakers, Changfeng Motor will have its product strategy integrated into the plans and development of the Guangzhou Auto.

To own a hefty bargaining chip in the merger talks, Changfeng Motor has started developing its sedan models. "We will unite with a powerful giant to develop our sedan models, to have a strong company to speed up our growth -- this will be a good thing," Changfenmg Motor general manager Chen Zhengchu said recently.

Currently, Guangzhou Auto's profit-making models are sedans and MPVs, mostly made by its joint ventures with two Japanese carmakers: Toyota and Honda. In the SUV segment, Changfeng Motor, 20% controlled by Mitsubishi Motors, has the capabilities and expertise to fill this gap for Guangzhou Auto.

Guangzhou Auto aims to become China's fourth largest automaker and one of the world's top 500 companies by 2010. To achieve this ambition, mergers and acquisitions seem to feature prominently in its expansion strategy.

Gasgoo.com

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More on the Guangzhou-Changfeng merger.

The Guangzhou-Changfeng merger was sealed today by both company chairmen.

The deal will see:

* Guangzhou Auto will become the largest stake holder in Changfeng
* Changfeng Auto parent co will own 21.98%
* Changfeng Auto will change its name to Guangzhou-Changfeng Auto
* Will produce 500,000 cars per year.
* Guangzhou Auto will invest 10 billion RMB in Hunan
* First car to launch in August 2010.

The take over is the first of this year, and is certainly not expected to be the last.

Bloomberg with more info:

Guangzhou Auto will buy 151 million shares from Changfeng Motors Group Co., parent of Changfeng Motors, according to a statement today on Guangzhou Auto’s Web site. Guangzhou Auto will become the biggest shareholder of Changfeng Motor with Changfeng Motor Group holding 22 percent. The statement did not give any financial details.

The deal will add sport-utility vehicles to Guangzhou Auto’s product lineup, which already includes cars made through ventures with Toyota Motor Corp. and Honda Motor Co. The move is also in line with China’s push to combine some of the nation’s roughly 130 automakers to help build stronger companies that can compete globally.

“The deal is beneficial to both parties as Changfeng lacks capital and Guangzhou Auto is short of SUVs,” said Zhu Xuedong, an Industrial Securities Co. analyst in Shanghai. “The general trend will be to see more such consolidation in the coming months.”

Guangzhou Auto and Changfeng Motor will invest about 10 billion yuan ($1.47 billion) in Hunan over the next five years to build up half a million units of production capacity and aim to have sales of more than 40 billion yuan and total profit of 5 billion yuan before tax, according to the statement.

Shanghai-listed Changfeng Motors, part-owned by Japan’s Mitsubishi Motors Corp., is controlled by neighboring Hunan province.

source: China Car Times

[Ocean wang]

The State-owned Assets Supervision and Administration Commission (SASAC) has examined the equity transfer between Changfeng Auto and Guangzhou Automobile Group Co. (GAC) and approved the transfer of 151,052,703 ......
Global Times - SASAC approves GAC?s restructuring of Changfeng Auto

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Liebao to become GAC's second own brand

January 20, 2011
Guangzhou Automobile Group (GAC Group) revealed today that the Changfeng Liebao brand will be sold directly under the Guangzhou label, becoming the company's second own brand.

At a press conference GAC Group CEO Zhang Fangyou announced that Changfeng Motors was currently undergoing further reorganization. Currently GAC owns minority 29% control of Changfeng. GAC will take full control of the company's Liebao brand, allowing it to become the company's second own brand after the GAC Trumpchi. GAC Motors Deputy General Manager Wu Song refused to offer additional comment regarding the transaction.

The Liebao series of SUVs is based on Mitsubishi Pajero techonology fitted to satisfy the demands of the Chinese automobile market. Over 30,000 Liebao SUVs were sold last year.

GAC hopes that 2011 will be a breakthrough year for the SUV, with targeted sales exceeding 70,000 units, bringing in over 150 billion yuan ($22.82b). GAC has set its sights for 2015 even higher, with a sales goal of 3 million vehicles.

Changfeng Motors currently has two factories in Changsha and Yongzhou producing the SUV. With GAC taking direct control of the Liebao brand, only the Yongzhou site will continue to produce the vehicle.

http://autonews.gasgoo.com/china-new...d-110120.shtml