BMW's Proposed Stake Increase in China JV Approved -- Update
18 January 2019 - 8:44PM
Dow Jones News
(Updates with background on the deal, foreign-ownership
restrictions.)
By Nathan Allen
BMW AG (BMW.XE) said Friday that it has received shareholder
approval to increase its stake in the BMW Brilliance Automotive
joint venture in China, bringing the German group a step closer to
assuming majority control over the company.
A majority of shareholders in Brilliance China Automotive
Holdings Ltd. voted in favor of selling a further 25% stake in the
joint venture to BMW, the German auto maker said.
BMW announced in October that it would pay 3.6 billion euros
($4.10 billion) to increase its ownership of the JV to 75% from
50%, becoming the first foreign car maker to take advantage of
Beijing's relaxation of foreign-ownership limitations.
The stake increase is set to complete in 2022, when China fully
lifts the requirement for auto makers in the country to operate as
part of a joint venture with a local partner.
Foreign auto makers had previously been required to build
vehicles in China through joint ventures in which they could hold a
50% stake at most.
As part of the deal, the joint venture will significantly expand
its manufacturing base in Shenyang in northeast China.
Write to Nathan Allen at nathan.allen@dowjones.com
(END) Dow Jones Newswires
January 18, 2019 04:29 ET (09:29 GMT)
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