An industry first as a German company buys into a Chinese one
Daimler and BAIC strengthen partnership Image: Daimler |
Foreign auto makers forming joint ventures with Chinese companies is fairly commonplace, as is Chinese manufacturers purchasing ailing foreign manufacturers.
However, a German car giant buying into a local Chinese brand is highly unusual.
In a first-of-its-kind deal, Daimler AG has become the first foreign company ever to acquire a stake in a Chinese OEM.
The deal will see the German manufacturer take a 12% stake in one of China's most successful auto manufacturers, BAIC Motor, owned by Beijing Automotive Group (BAIC).
The stake will also grant Daimler two seats on BAIC's board, which will be occupied by Daimler's current Greater China head, Hubertus Trosker, and CFO, Bodo Uebber. The two companies have long collaborated on joint ventures, but the acquisition is likely to change the dynamics of the partnership.
Crucially, the deal also awards the German manufacturer an extra 1% stake in Beijing Mercedes-Benz Sales Service Corporation - taking its holding to 51% and giving Daimler control over a key platform for Mercedes' growth in China.