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GM's China partner SAIC says "closely watching" automaker's plans for IPO

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GM's China partner SAIC says "closely watching" automaker's plans for IPO

September 20, 2010 12:50 CET

SEOUL (Bloomberg) -- SAIC Motor Corp. said it's “closely watching” the initial public offering of General Motors Co. after Reuters reported the Chinese company is in talks to buy a stake in the largest U.S. automaker.

“SAIC is closely watching the progress of a GM IPO,” Judy Zhu, a spokeswoman for the automaker, said in a mobile phone text message today. “As a strategic partner of GM, SAIC wishes the success of the GM IPO.”

SAIC, GM's partner in China, is in talks to buy a stake in the carmaker, Reuters reported on Sept. 18, citing unidentified people familiar with the situation. GM's initial public offering will probably be open to overseas investors as the U.S. Treasury seeks to pare its stake in the company.

“We expect that potential investors will be sought across multiple geographies with a focus on North American investors,” according to a statement posted on a government web site. Retail and institutional investors will be offered shares, it said.

The U.S. Treasury holds a 61 percent stake in GM following a $50 billion taxpayer bailout for the Detroit-based carmaker, which filed for bankruptcy protection in June 2009.

GM “cannot comment on speculation surrounding a public offering,” Shanghai-based spokesman Mike Albano said in an e-mailed statement on Sept. 18. GM filed for the IPO in August.

Separately, Carlos Ghosn, the head of the Renault SA-Nissan Motor Co. alliance, said today that he isn't interested in investing in GM. He spoke at a plant opening in Zhengzhou, central China.

Contact Automotive News

Read more: http://www.autonews.com/apps/pbcs.dll/article?AID=/20100920/ANE/100929998/1131#ixzz106IXVN2y

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Chinese automaker SAIC may buy General Motors stake

Report: Carmaker interested in single-digit share of IPO

BY CHRISSIE THOMPSON

FREE PRESS BUSINESS WRITER

China's top automaker SAIC has expressed interest in buying a stake in General Motors once the Detroit automaker begins issuing stock again, a person familiar with the situation said Sunday.

GM tentatively has planned its initial public stock offering for mid-November. The stock sale will allow the U.S. Treasury, which owns 61% of GM in exchange for having funded its 2009 bankruptcy, to begin recouping some of the $50 billion it invested.

SAIC, which is funded by the Chinese government, already has several joint ventures with GM. The talks to buy an interest in GM are considered preliminary at this point. How far they proceed will depend on the U.S. Treasury, said the person, who spoke anonymously because IPO preparations are confidential.

GM's relationship with SAIC dates back more than a decade, and is crucial as GM continues to expand its market share in the key Chinese market. In 2009, one of GM's joint ventures with SAIC was the first automaker to sell more than 1 million vehicles in China in a single year.

But Chinese investment in GM might not be politically popular in the U.S. as the communist country continues to grow as a global economic power.

Reuters, which first reported the talks with SAIC, said that SAIC has expressed an interest in acquiring a single-digit share in GM, citing an unnamed person with knowledge of the discussion.

The Treasury said late last week that investors in the IPO could come from "multiple geographies, with a focus on North American investors."

Although the Treasury may decide the SAIC investment is politically unsuitable, the government and GM likely will have to weigh expressions of interest from several foreign countries' investment funds.

Read more: Chinese automaker SAIC may buy General Motors stake | freep.com | Detroit Free Press http://www.freep.com/article/20100920/BUSINESS0101/9200343/1210/BUSINESS01/Chinese-automaker-SAIC-may-buy-General-Motors-stake#ixzz106O0bJH0

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GM, Chinese auto maker in talks over IPO investment

By Chrissie Thompson

Free Press business writer

China's top automaker SAIC has expressed interest in buying a stake in General Motors once the Detroit automaker begins issuing stock again, a person familiar with the situation said today.

GM tentatively has planned its initial public stock offering for mid-November. The stock sale will allow the U.S. Treasury, which owns 61% of GM in exchange for having funded its 2009 bankruptcy, to begin recouping some of the $50 billion it invested.

SAIC, which is funded by the Chinese government, already has several joint ventures with GM. The talks to buy an interest in GM are considered preliminary at this point. How far they proceed will depend on the U.S. Treasury, said the person, who spoke anonymously because IPO preparations are confidential.

GM's relationship with SAIC dates back more than a decade, and is crucial as GM continues to expand its market share in the important Chinese market. In 2009, one of GM's joint ventures with SAIC was the first to sell more than 1 million vehicles in China in a single year.

But Chinese investment in GM might not be politically popular in the U.S. as the communist country continues to grow as a global economic power.

Reuters, which first reported the talks with SAIC, said that SAIC has expressed an interest in acquiring a single-digit share in GM, citing an unnamed person with knowledge of the discussion.

The Treasury said late last week that investors in the IPO could come from "multiple geographies, with a focus on North American investors."

Although the Treasury may decide the SAIC investment is politically unsuitable, the government and GM likely will have to weigh expressions of interest from several foreign countries' investment funds.

Read more: GM, Chinese auto maker in talks over IPO investment | freep.com | Detroit Free Press http://www.freep.com/article/20100919/BUSINESS0101/100919019/1210/business01/GM-Chinese-auto-maker-in-talks-over-IPO-investment#ixzz106Ra1Idd

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Chinese automaker to become large GM shareholder?

10:15 AM

China's top automaker SAIC has expressed interest in buying a stake in General Motors once the Detroit automaker begins issuing stock again, a person familiar with the situation told Drive-On colleague Chrissie Thompson of Detroit Free Press.

GM tentatively has planned its initial public stock offering for mid-November. The stock sale will allow the U.S. Treasury, which owns 61% of GM in exchange for having funded its 2009 bankruptcy, to begin recouping some of the $50 billion it invested.

SAIC, which is funded by the Chinese government, already has several joint ventures with GM. The talks to buy an interest in GM are considered preliminary at this point. How far they proceed will depend on the U.S. Treasury, said the person, who spoke anonymously because IPO preparations are confidential.

GM's relationship with SAIC dates back more than a decade, and is crucial as GM continues to expand its market share in the key Chinese market:

In 2009, one of GM's joint ventures with SAIC was the first automaker to sell more than 1 million vehicles in China in a single year.

But Chinese investment in GM might not be politically popular in the U.S. as the communist country continues to grow as a global economic power:

Reuters, which first reported the talks with SAIC, said that SAIC has expressed an interest in acquiring a single-digit share in GM.

The Treasury said late last week that investors in the IPO could come from "multiple geographies, with a focus on North American investors."

Although the Treasury may decide the SAIC investment is politically unsuitable, the government and GM likely will have to weigh expressions of interest from several foreign countries' investment funds.

link:

http://content.usatoday.com/communities/driveon/post/2010/09/chinese-automaker-to-become-large-gm-shareholder/1

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GM stake interests China's SAIC

Partner of 13 years considers investing when IPO launches

David Shepardson and Christine Tierney / The Detroit News

China's largest automaker SAIC Motor Corp. has reached out to General Motors Co. about acquiring a stake in the Detroit automaker when the company launches a public stock offering later this year, a person briefed on the matter said Sunday.

SAIC spokeswoman Zhu Xingjun said Sunday, "SAIC is closely watching the progress of GM's IPO. SAIC wishes the success of the GM IPO." She declined further comment.

Last month, Shanghai Auto Chairman Hu Maoyuan told reporters in China that the company was considering an investment in GM. Maoyuan said SAIC "will watch GM's IPO closely, and think carefully if we should purchase the shares or not," according to the Financial Times.

Reuters first reported the contact between state-supported SAIC and GM, and said SAIC had expressed an interest in acquiring a "single digit" share in GM, or less than 10 percent. A 5 percent stake could cost $2.5 billion to $3 billion, based on estimates of GM's future market capitalization.

SAIC is GM's principal partner in China, where the companies have two joint ventures. The companies announced in December they were teaming up to sell vehicles in India. They are planning to bring a low-cost sedan to India next year that's being designed in China -- the first of a series of new models.

Late Friday, the Treasury Department said it expects investors across the world will be invited to invest in GM, and emphasized none would get special treatment. "We expect that potential investors will be sought across multiple geographies with a focus on North American investors, in line with what is typical in similar transactions," Treasury said in a statement.

GM plans to kick off a worldwide road show after the Nov. 2 midterm elections to promote the initial public offering, and launch the IPO by year's end.

Some have speculated that the initial offering will sell $10 billion to $16 billion in stock, but the government hasn't decided how much of its 304 million shares it will sell and the IPO could be below $10 billion.

The government swapped about $43 billion of its $49.5 billion bailout of GM for a 61 percent equity stake.

SAIC and GM have been partners for 13 years and last month announced they are developing a new small-displacement gasoline engine family and an advanced transmission. The new small gasoline engine, which will be offered in displacements from 1.0 liters to 1.5 liters, hits right at the heart of the global vehicle market. Its compact, lightweight design combines direct injection and turbocharging, providing customers unparalleled fuel efficiency and performance.

The engine will be used by GM and SAIC Motor in China and in future vehicles worldwide, providing fuel efficiency advances beyond traditional technologies.

From The Detroit News: http://detnews.com/article/20100920/AUTO01/9200361/1148/auto01/GM-stake-interests-China-s-SAIC#ixzz106WY96Be

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Amazing.

Government has American taxpayers bailout GM after making GM uncompetitive by allowing foreign competitors to play by different rules.

Now they might sell our investment to a company that's owned by the Chinese government.

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CHINA'S SAIC CONSIDERING GM SHARES

By Andrew Ganz

Chinese automaker SAIC Motor Corporation says that it is looking at investing in General Motors' IPO if “conditions are favorable,” said the automaker's chairman, Hu Maoyuan.

SAIC is one of GM's major Chinese partners; the country, which boasts one of the world's most important new car markets, requires foreign entities to partner with a Chinese automaker in order to do business. GM and SAIC have worked together for more than 10 years.

“GM is our important strategic partner,” Hu said. “We are not clear about the details of its IPO. We will make the right decision once we know details.”

GM says that it can't comment on IPO speculation. The IPO will more than likely be available to international investors.

Rumors have circulated about other automakers considering acquiring shares of GM through the IPO. However, Renault-Nissan chief Carlos Ghosn said this morning that his company is not interested in investing in GM.

link:

http://www.leftlanenews.com/chinas-saic-considering-gm-shares.html

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China's SAIC May Invest in General Motors' Share Sale, Chairman Says

September 21, 2010 07:36 CET

SHANGHAI (Bloomberg) -- SAIC Motor Corp. said it may invest in the initial public offering of partner General Motors Co., cementing ties between the biggest U.S. and Chinese automakers.

China's largest carmaker will consider investing in GM if “conditions are favorable,” Chairman Hu Maoyuan said in Shanghai yesterday. The company hasn't yet made a decision whether to make the investment and is waiting for the details of the share sale, he said.

The automakers, which have made cars together in China for more than a decade, said in December they would also sell low- cost vehicles in India. GM filed for an IPO in August as the U.S. government seeks to pare the 61 percent stake it gained in the company through its bankruptcy and $50 billion taxpayer bailout last year.

“GM is our important strategic partner,” Hu said. “We are not clear about the details of its IPO. We will make the right decision once we know details.”

SAIC's Shanghai-listed shares rose as much as 3.4 percent today to 17.52 yuan and changed hands for 17.41 yuan as of 10:51 a.m. The benchmark Shanghai Composite Index gained 0.1 percent.

The joint venture partners are developing a new engine and transmission system together, have launched a new car brand Baojun in the Chinese market, and have formed an alliance to sell low-cost cars in India.

Perfect Sense

“Politics and government relationship aside, it makes perfect sense,” said Bill Russo, Beijing-based senior adviser at Booz & Co. “Why can't there be a China-America alliance? Fear of China is the only reason.”

GM's initial public offering will be open to overseas investors, the U.S. Treasury said in a statement on its website. Retail and institutional investors will be offered shares, and the Treasury “will not involve itself in decisions regarding allocation of shares to specific buyers,” the department said.

GM “cannot comment on speculation surrounding a public offering,” Shanghai-based spokesman Mike Albano said in an e-mailed statement on Sept. 18.

China Ventures

The Detroit-based automaker, whose partners in China also include Wuling Motors Co. and China FAW Group Corp., sold 1.2 million vehicles in the nation during the six months ended June 30, according to a company filing related to the IPO.

Combined income from the joint ventures with SAIC and Wuling rose to $734 million in the first six months of the year from $298 million a year earlier.

“It's not a bad idea for GM and SAIC to further their ties if it means getting GM better ingrained in the Chinese market,” Aaron Bragman, an analyst with IHS Automotive in Northville, Michigan, said in a telephone interview. “That's where the money is going to be made for the industry.”

China's wholesale deliveries of passenger cars increased 18.7 percent to 1.02 million units in August, compared with 13.6 percent growth in July, the China Association of Automobile Manufacturers said in an e-mailed statement on Sept. 9.

Sales in markets such as China and India are helping offset slumping demand in the U.S. and Europe. China, which overtook the U.S. as the world's largest auto market last year, may sell 16 million vehicles this year, the association said last month, boosting its forecast from a previous estimate of 15 million.

In Great Shape

GM, whose sales in China rose 19.2 percent from a year earlier to 181,625 vehicles last month, is counting on emerging markets including China to bolster profit as it prepares for what may be the second-largest initial public offering in U.S. history.

The carmaker is “in great shape” to hold an offering, United Auto Workers President Bob King said in a Bloomberg Television interview.

“It will actually help them sell more product when they've done the IPO,” King said. “I think the American public will see that they're a strong and healthy company.”

GM, China's largest foreign carmaker, makes vehicles including Buick Excelle and Regal cars as well as Chevrolet Lova compacts with its Chinese joint-venture partner SAIC Motor Co. It also makes Sunshine minivans at SAIC-GM-Wuling Automotive Co., a venture with SAIC in which it owns 34 percent.

The two partners plan to introduce the Chevrolet Volt in China next year, the U.S. carmaker said in a statement on July 27, as part of a plan to sell “several” hybrid and electric vehicles in the coming months.

In December, GM and SAIC signed an agreement to invest $650 million to form an equally-controlled venture to sell cars in India. The American automaker plans to spend $250 million in introducing five SAIC models in Asia's second most populous nation, Karl Slym, president of GM's Indian unit said in July.

Read more: http://www.autonews.com/apps/pbcs.dll/article?AID=/20100921/COPY/309219977/1131#ixzz10B80kXGm

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China's SAIC Considering Buying Stake in General Motors

TUESDAY, SEPTEMBER 21, 2010

Industry insiders are reporting that China's SAIC has expressed interest in buying a stake of General Motors come its public offering in November, though it has yet to make a solid commitment. GM has declined to comment on the matter.

The U.S. government is eager to unload its 61% stake in GM after taxpayers bailed out / loaned the iconic automaker to the tune of US$50 billion. This comes despite the political ramifications of selling part of the brand to foreign investors or sovereign-wealth funds.

The government has rejected suggestions that the IPO should be limited to domestic investors, however the Treasury has state that no single investor or investor group would receive, "a disproportionate share or unusual treatment."

The Initial Public Offering (IPO) of GM shares will include those held by the U.S. Treasury, a union-managed retiree trust and the Canadian government. The government's plan is to offload their stake in GM in one month, though GM CEO Dan Akerson believes it could in fact take years. The Treasury will wait until after the November midterms in order to keep politics out of the float.

SAIC's bid is not that farfetched, either. Insiders note that SAIC has been building cars with GM in China since the 1990, with its home market a key source of strength for GM. Year-to-date sales were up 19% in August, for instance, even though the U.S. and Europe are still struggling.

By Tristan Hankins

link:

http://carscoop.blogspot.com/2010/09/china-saic-considering-buying-stake-in.html

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I know what's going on here.

China is afraid that their recent intellectual property theft law may force GM to leave the country, so they're having one of their henchmen waiting on stand-by to make a move that could force the company to stay put.

Bastards.

Edited by whiteknight

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Prior to bankruptcy and US ownership of the company, GM has always been a public multinational corporation with shares for sale to ANY investor. Sure, they've played the patriotic card for "Chevy: An American Revolution" ads, but they've been building and selling more cars in China than in the US for a while now. If you fear globalization and want a nationalist industrial policy, perhaps being state-owned isn't so bad after all...

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Who managed the banks that toppled, leading the world into recession? Americans. Who loaned money to people who had no way of paying it off? Americans.

What nationality is Kirk Kerkorian? American.

All of a sudden, limiting investment to American's kinda gives me the shivers.

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Who managed the banks that toppled, leading the world into recession? Americans. Who loaned money to people who had no way of paying it off? Americans.

What nationality is Kirk Kerkorian? American.

All of a sudden, limiting investment to American's kinda gives me the shivers.

You're Canadian. Your input is invalid.

I'm just kidding.

What really voided your opinion was the use of an apostrophe in the last instance of "Americans." Good day.

:P

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