On September 14, GAC Group (601238.SH) announced it had signed a letter of intent with China FAW to acquire part of FAW's stake in a vehicle manufacturing joint venture via a share issuance, with supporting financing. After the transaction, FAW would become GAC's second-largest shareholder with strategic influence, while GAC's actual control remains unchanged.
The deal comes as national policymakers revive support for industry consolidation: on September 11, an NDRC official voiced support for large groups to merge and reorganize, pool R&D and production resources and avoid duplicative competition. The first equity tie-up between two major state-owned automakers is seen as a landmark step in accelerating consolidation.
GAC's A-shares were suspended from trading, expected to last no more than 10 trading days. The target JV's name has not yet been disclosed. Industry watchers say the move signals a new phase of state-owned auto-sector restructuring aimed at scale and efficiency.
Source: CnEVPost
