IDG weighs US$976 million deal for stake in Chery Auto’s parent: sources
- Chery Auto is one of China’s last few carmakers that is not publicly listed
- Beijing-based IDG is raising funds from investors for the potential transaction, according to sources
IDG Capital is considering buying shares in Chery Holding Group from existing shareholders for as much as 7 billion yuan (US$976 million), people familiar with the matter said, potentially giving the buyout firm exposure to one of the few unlisted major carmakers in China.
Beijing-based IDG is raising funds from investors for the potential transaction, said the people, who asked not to be identified discussing a private matter.
Any deal would come as Chery Group looks to simplify its shareholding structure considering its revived plans to list its unit Chery Automobile in China, the people said. As part of the restructuring, Chery Group’s shareholders could opt to swap their stakes for shares in Chery Auto, they added.
Chery Auto is exploring filing for an initial public offering as soon as next year and may seek a valuation of as much as 150 billion yuan, according to the people.
Deliberations are ongoing and may not lead to any transactions, the people said. Details of the potential Chery Auto IPO could also change, they added. Representatives for Chery and IDG Capital did not respond to requests for comment.