CHONGQING – The Ministry of Commerce recently approved the sale of a 10 percent stake in China’s biggest auto glassmaker, Fuyao Group Glass Industries (Fuyao), to the U.S. investment bank Goldman Sachs, according to a statement from Fuyao on August 24, reported by China Daily.
Fuyao will sell ¥111.28 million ($14.64 million) new shares to Goldman Sachs, according to the Chinese company’s formal statement to the Shanghai Stock Exchange. Eighty percent of the funds raised will repay bank loans and the 20 percent left will be added to the company’s circulating fund. The deal would help Fuyao chop its financing expenses, analysts predicted.
Fuyao also said it will resubmit the application for the share placement to the China Securities Regulatory Commission on August 27 because its current one is outdated.
The company is the largeat auto glass maker in China, holding a 60 percent share, company president Cao Dewang has previously noted. It has over 300 retail outlets in large- and medium-sized cities on the mainland. It also has subsidiaries in Hong Kong and the U.S. The company’s net profit was ¥417 million in the first six months of this year, up 41 percent compared with the same period last year.
Fuyao also plays an important role in the international auto glass market. Overseas markets contributed almost 30 percent of Fuyao’s ¥3.88 billion in sales last year. The company, based in Fuqing, Fujian Province, is currently the fifth-largest maker of auto glass in the world.
Fuyao is also on a shortlist of glass suppliers for all top eight carmakers, along with Saint-Gobain in France and PPG in the U.S.