Chery expected to merge with Jianghuai in Q4

• Source: Gasgoo
• [10:11 August 05 2009]
• Comments

Anhui Jianghuai Automobile Co., Ltd. (SHSE: 600418) said lately that it would not carry out asset regroup, share transfer or rights offering with Chery Automobile Co., Ltd. in the coming three months.

But insiders close to the state-owned asset supervision authority in Anhui Province disclose that the regroup between Anhui Jianghuai Automobile and Chery Automobile has been put on the agenda and the authority is scheduled to come up with regroup plans in the fourth quarter of 2009.

Lately the local government in Anhui mapped out a scheme to stimulate the local automobile industry by pushing for regroups and mergers among carmakers.

Following the launch of the scheme, rumors have been swirling that JAC is likely to merge with Chery Automobile, which has sent stock price of JAC 22.13 percent higher to close at CNY 7.45 yesterday.

None of the two companies are willing to be swallowed up by the opposite side because they are both key state-owned companies.