SAIC Motor to Consider Investing in General Motors IPO

Strategic Insights -

Bloomberg News SAIC Motor Corp, China's largest automaker, may invest in the initial public offering of its partner General Motors Co, following a decade-long joint venture in China. SAIC Chairman Hu Maoyuan said the Chinese company will consider investing in GM's IPO if conditions are favorable, although details of the investment are still unclear. This move would strengthen ties between the two automakers, with SAIC set to co-invest in low-cost vehicles in India alongside GM. The partnership comes as GM prepares to sell shares to the public, with the US Treasury seeking to pare its 61% stake in the company gained through the $50 billion bailout in 2009.

Key Takeaways:

  • SAIC Motor Corp will consider investing in General Motors Co's initial public offering (IPO) if conditions are favorable.
  • The joint venture between SAIC and GM has been operational for over a decade, with the two companies making cars together in China.
  • GM filed for its IPO in August 2009, as the US government seeks to reduce its 61% stake in the company gained through the $50 billion taxpayer bailout.
  • SAIC Chairman Hu Maoyuan stated that the Chinese company will make an informed decision on investing in GM's IPO once details are clear.
  • Revenues from combined ventures between SAIC, GM, and Wuling Motors rose to $734 million in the six months ending June 30, a significant increase from $298 million in 2009.
  • GM sold 1.2 million vehicles in China in the six months ending June 30, according to a GM filing related to the IPO.
  • United Auto Workers President Bob King said that GM is "in great shape" to hold an offering, and the American public will see that they're a strong and healthy company.

Statistics:

  • SAIC and GM's combine ventures generated $734 million in revenues in the six months ending June 30.
  • Revenues from combined ventures rose from $298 million in 2009 to $734 million in the six months ending June 30.
  • GM sold 1.2 million vehicles in China in the six months ending June 30, according to a GM filing related to the IPO.
  • The US government has a 61% stake in GM gained through the $50 billion taxpayer bailout in 2009.
  • GM filed for its IPO in August 2009, but no specific date for the IPO is provided.

Sources:

  • Bloomberg News
  • 2010 Toronto Star
  • SAIC Motor Corp
  • General Motors Co
  • US Treasury
  • United Auto Workers
  • IHS Automotive