WUHAN, Hubei – Dongfeng Motor Group, one of China’s largest vehicle manufacturers, is seeking to acquire a stake of around 30 percent in Getrag, a leading automotive transmission supplier based in Ludwigsburg, Germany, yicai.com reports.
Dongfeng is currently in advanced talks with Getrag about the potential deal, which, if successful, would mark the first time that a Chinese company has bought into the German auto sector.
According to a Reuters report, Getrag is looking for a strategic partner to inject fresh capital into the company. The said stake in the company would be worth less than €500 million ($700 million).
Getrag is a global brand allied with Ford Motor Co., but also supplies transmissions to other auto manufacturers, including General Motors, Daimler AG, Ferrari, Fiat, Porsche, BMW (MINI), Toyota and the Volkswagen AG, sources said.
Previously, Dana Holding purchased a 30 percent stake in Getrag in 2000 from owner the Hagenmeyer family, but sold it back to the family in 2007 after the U.S. company entered Chapter 11 protection.
Subsequently, Hagenmeyer tried to sell the 30 percent stake to other strategic partners after Dana’s exit, including Canada’s largest parts supplier Magna International, but talks fell through due to differences over price.
In 2010, Getrag gained €2.6 billion in revenue, with a small profit after losses in the past two years amid the global financial crisis – which hampered its earlier efforts to find a strategic partner. The company now expects to improve its profitability substantially this year, according to Reuters.
Neither Dongfeng nor Getrag has commented on the deal reported by far.