The fate of Trollhättan will be determined in China. A lot has happened there today. The sale of the car division, which was expressly denied a few days ago, seems to be becoming a reality. Chinese media reports on talks that Evergrande is to have with other companies. First reported Jiemian News, then other media, meanwhile the message has also reached Reuters.
Names are not mentioned. But it should be about large corporations that want to take over part of Evergrande Auto or the entire package. The conversations are developing well, I heard. Evergrande Auto stock (HK 0708) took the news positively and closed trading with gains.
The Evergrande Auto Package would be attractive. State-of-the-art factories that can effectively produce electric cars. In addition, almost completely developed models that come up with the most modern technical features that are available. With Trollhättan Evergrande Auto offers a European development and production location and with Protean a technology leader for wheel hub motors.
Who is eligible for the takeover?
The talks are to be held with private and state-owned companies. Large manufacturers such as SAIC, BAIC, FAW or the expansive Geely Group come into question as buyers. Sales of this caliber are kindly directed by the administration in China. That intervenes when things don't go according to the script that the strategists in Beijing came up with.
A historical example is the bankruptcy of the Rover Group and the acquisition of the rights to the MG brand by the Nanjing Group on the one hand, and the rights to the Rover 75 by SAIC on the other. This unfortunate constellation led Nanjing Automobile and the MG brand to the SAIC Group in 2007 with tuition from Beijing, after SAIC had previously been defeated in the takeover of MG.
For years Beijing has been dreaming of a national champion who can dominate the world class of automobile manufacturers. The Evergrande crisis offers an opportunity to regulate the market. If the reports are correct, Beijing will not miss the opportunity.