Chinese car firm Great Wall cools talk over its interest in Fiat Chrysler deal

 
Rebecca Smith
Fiat Chrysler is looking for a buyer or partner to help it manage rising costs
Fiat Chrysler is looking for a buyer or partner to help it manage rising costs (Source: Getty)

Great Wall Motor has cooled talk concerning its interest in acquiring part of, or all of, Fiat Chrysler Automobiles, saying it has not yet made any "concrete progress" with its interest.

The Chinese car firm confirmed yesterday it was interested in Fiat Chrysler, but the Italian-American firm that owns Jeep, Alfa Romeo and Maserati, said yesterday it had "not been approached by Great Wall Motors in connection with the Jeep brand or any other matter" relating to its business.

Read more: Fiat Chrysler bats away Great Wall bid talk

In a filing to the Shanghai stock exchange today, Great Wall said: "We took interest in FCA but there has been no concrete progress so far."

"We have not had any negotiation, nor signed any agreements with FCA," it added.

Trading in Great Wall's Shanghai-listed shares resume tomorrow, after it was suspended today at the firm's request.

Dr Yupu Lin, a research fellow at Warwick Business School, said a prospective deal would make sense for the Chinese car firm though.

"Although Great Wall Motors is the largest SUV maker in China, it has a key technology void, a weakness hindering its long-term development due to a lack of sufficient R&D expenditure," he said. "Acquiring FCA, especially Jeep, will overcome this weakness and enhance its technological capacity in SUV manufacturing."

However, he noted it would be difficult for Great Wall to acquire the whole FCA group "without external finance, given their respective market values". Lin said Great Wall would increase its chances of completing the acquisition "if it used offshore finance in its takeover structure".

Read more: BMW brings Fiat Chrysler on board its driverless car project

Related articles