(Reuters) – SAIC Motor Corp (600104.SS), China’s biggest automaker, said it was planning a private placement of new shares and trading in its stock will be suspended from Monday.
The board of directors of SAIC, which has vehicle manufacturing ventures with General Motors GM.UL and Volkswagen (VOWG.DE), will discuss the non-public share issue and make an announcement on or before June 25, it said in a filing to the Shanghai stock exchange on Saturday.
Shares of SAIC ended down 3.8 percent on Friday to 12.05 yuan. The stock has dropped about 40 percent this year, underperforming a 23 percent fall in the benchmark Shanghai Composite Index, on expectations of slower growth in China’s auto market this year.
Growth of vehicle sales in China, which overtook the United States last year to become the largest auto market in the world, is expected to slow down this year from 2009 when sales surged about 44 percent on government incentives.
But SAIC has said it is confident the company would achieve its annual target of selling 3 million vehicles this year.
So far, SAIC, the maker of Roewe and MG sedans, is virtually the only Chinese automaker that has made some inroads in China’s lucrative medium-to-higher end segment, still dominated by locally made Buick, Passat, Accord and Camry models.
(Reporting by Alison Leung; Editing by Ron Popeski)