SAIC Motor Corp (上海汽車) does not rule out investing in US-based General Motors Co’s (GM) initial public offering (IPO), the chairman of China’s top automaker said yesterday.
Sources said GM was on track to move ahead with an IPO in the middle of next month after a recent round of meetings with sovereign wealth funds.
When asked by reporters at a conference in Shanghai about SAIC’s interest in the GM IPO, SAIC chairman Hu Maoyuan (胡茂元) said the company was undecided but would not rule out taking a stake.
“We will study and pay close attention to it, and yes, this is such a big IPO, and GM is moving to a very positive direction. I believe demand in the US will pick up as the economy recovers,” Hu said.
“We are positive on GM, we believe the restructuring is very good for GM. We can see that it is moving to a healthy direction of development,” he said.
Last month, sources told reporters that SAIC had reached out to GM to explore the prospect of taking a stake in the US automaker. The two companies have a 13-year old relationship.
“SAIC and GM have had a solid partnership all these years. Many expect SAIC to take a stake in GM when it goes public again,” Huatai Securities (華泰證券) analyst Chen Liang (陳亮) said.
“An equity tie will bring the partnership to the next level and GM could possibly step up its technology input in the joint venture,” he said referring to Shanghai GM, GM’s flagship car venture with SAIC in the Chinese city.
The GM IPO has been closely watched both because of its expected scale and because of the involvement of the US government, which is looking to the landmark stock offering to reduce its almost 61 percent stake in the automaker.
No US dollar amount has been set for the IPO and that will not be determined until GM files the final prospectus early next month, sources told reporters.
Singapore’s GIC and Temasek Holdings, Kuwait Investment Authority, Qatar Investment Authority and the Abu Dhabi Investment Authority were all approached as part of those meetings, one of the sources said.
Temasek declined to comment and GIC was not available for comment.
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