Heavy-duty engine producer to raise holding in truck maker for 684m yuan
Weichai Power, one of China's largest makers of engines for heavy-duty trucks, is to tighten its grip on a truck manufacturing associate for 684.75 million yuan.
Fresh from buying a substantial stake in Torch Automobile group in August last year, Weichai said yesterday it had agreed to raise its stake in the Shenzhen-listed company to 28.12 per cent from 12.69 per cent.
The deal will cement Shandong-based Weichai as the biggest shareholder of Torch and bolster its exposure to the production and sales of heavy-duty trucks and related parts.
It will also help fill a revenue gap arising from the departure of China National Heavy Duty Truck, Weichai's parent and major customer, which is seeking a listing in Hong Kong and will separate from Weichai.
The parent has recently switched to Weichai's rival for sourcing engines.
Weichai chairman and chief executive Tan Xuguang yesterday said the group would exploit further potential business opportunities and synergies with Torch in the near future.