From the Washington Daily:
[INDENT]General Motors Co. will sell its steering-parts operation to a Beijing-based business venture in what could be the largest move by a Chinese company into the U.S. auto-parts industry.The car maker announced a deal Wednesday to sell its Nexteer Automotive business to Pacific Century Motors, an entity comprised of Beijing-based auto-industry supplier Tempo International Group and a Chinese government-owned financial enterprise knows as E-Town.
Financial terms weren’t disclosed but the deal is expected to total over $450 million.
General Motors said earlier this year that it planned to sell the steering operations, which it took over last year from supplier Delphi Corp. GM acquired the operations last summer as part of an agreement to help usher Delphi, its former parts unit, out of bankruptcy to ensure the continuous flow of parts.
Nexteer, based in Saginaw, Mich., operates 22 factories in North America, Europe, South America and Asia. The 100-year-old company, once known as GM’s Saginaw Steering division, employs 6,200 people and does business with more than 60 auto manufacturers. Nexteer had $2.1 billion in revenue in 2008, with GM its largest customer.
Based on the size of the company, Nexteer could become one of the largest Chinese-owned auto suppliers with major operations in the U.S., said Craig Fitzgerald, a partner with Plante & Moran, an accounting and consulting firm in Southfield, Mich.
About a dozen Chinese and Indian companies have purchased U.S.-based parts operations in the last few years, Mr. Fitzgerald said, though most were far smaller than Nexteer.
Tempo is part owner of another former Delphi business. In November, Tempo joined the Beijing government and another Chinese company to buy Delphi’s brake and suspension businesses for $100 million.
Unlike Japanese-based parts makers, which traditionally prefer building new U.S. operations, Chinese and Indian companies have tended to purchase existing ones, Mr. Fitzgerald said.
The U.S. car industry is warily watching the growth of the manufacturing base in China and India, two major emerging auto markets. Within the decade, many analysts expect Chinese companies will be selling cars in the U.S., adding to the already intense competition and possibly driving down prices.
The Nexteer sale “supports our objective to focus on our core auto business,” GM Vice Chairman Steve Girsky said in a statement. GM is working to get its finances and operations in order ahead of an expected return to the stock markets this year. The car maker want to allow the U.S. government to begin selling its 61% stake in the company.
[/INDENT]source: Chinese Car News | GM sells off family heirlooms to Chinese buyer | China Car Times