Daimler’s Plan To Invest in Beiqi Foton Torpedoed
Daimler’s attempt to buy a 24% stake in Chinese truck maker Beiqi Foton Motor has been thwarted. Having missed out on this shortcut to expansion in China’s heavy vehicle market, the German manufacturer could blame either the rapid rise in Beiqi Foton’s share price or the procedural sluggishness of Chinese officials in granting approvals or both.
Beiqi Foton said it had terminated the private share placement plan inked in November of last year with the German company, then still named DaimlerChrysler. At the time, DaimlerChrysler agreed to subscribe for 297 million new A-shares at 2.75 yuan per share, for a total of 817 million yuan ($110.3 million), representing 24% of the company’s enlarged capital base.
The parties also agreed last November to form an alliance to cooperate in heavy-duty truck manufacturing. The Beijing-based truck manufacturer sold 291,774 light-duty trucks, 35,552 medium and heavy trucks and 15,201 intercity buses in 2006.
