BEIJING – Daimler AG, the parent of Mercedes－Benz and Smart, is eyeing a 10 to 20 percent stake in the passenger car unit of its Chinese partner BAIC Group as part of efforts to boost its position in the world’s largest car market, according to sources.
“The investment will come ahead of the planned IPO (initial public offering) of BAIC Motor, and Daimler is set to be the only automotive anchor investor,” an insider was quoted as saying.
BAIC is planning to take its BAIC Motor unit public in late 2013 or in 2014 and Daimler could take a stake ahead of that flotation, giving it greater exposure to the Chinese market, Reuters reported.
“BAIC is planning an IPO, we will support that intention,” Dieter Zetsche, chairman of the board of management of Daimler AG and head of Mercedes-Benz Cars Division, was quoted as saying. “In that context of course, we are negotiating what the framework would be.”
Daimler seeks to raise funds on capital markets, according to Dieter Zetsche at the Detroit auto show, AFP reported.
“Daimler would benefit from the potential rise of the shares in the IPO, while BAIC Motor would be able to present a strong anchor investor, which may help attract other investors,” an insider told Reuters.
Daimler declined to comment, while BAIC, China’s fifth- largest automaker, was not immediately available, according to sources.