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Auto glass maker to sell Goldman stake

(China Daily)
Updated: 2006-11-21 08:26

"The deal will help Fuyao reduce its financial expenses," Zhang said. "As the leader in China's auto glass market, the company is import in the international auto glass market."

By the third quarter of this year, Fuyao's total debt was 4.6 billion yuan (US$582 million). It said the deal is expected to reduce its bank loan by 710 million yuan (US$89.87 million). By the third quarter, the company's assets to debt ratio was 63.59 per cent, much higher than the industry average.

The company's third-quarter profit jumped 46 per cent to 162 million yuan (US$20.51 million) from a year earlier and sales increased 21 per cent to 1 billion yuan (US$126.58 million). It had 392 million yuan (US$49.62 million) of net income last year.

Shares of Fuyao yesterday rose 5.81 per cent to 10.57 yuan (US$1.34) on the Shanghai Stock Exchange.

As China's largest auto glass company, Fuyao will produce 11 million pieces of auto glass by the end of this year, its vice-president Bai Yaohua told China Daily at an earlier date.

Its production volume will reach 13 million pieces by the end of next year after the establishment of the Beijing and Guangzhou branches, he said.

Established in East China's Fujian Province in 1987, the company's registered capital rose from 6.27 million yuan (US$793,671) to 6.7 billion yuan (US$848.1 million) in 2006, and export volume stood at more than US$100 million in 2005.

The company has more than 300 chain stores in large and medium-size cities in China. It has also built four global sales centres in Hong Kong, the United States, Australia, and Russia.

As a key original equipment manufacturer, Fuyao has around 80 foreign customers including Audi, FAW, Hyundai, Suzuki and Mitsubishi. Earlier this August the company submitted a final bid to acquire Ford Motor Co's North American auto glass-making operations.

Analysts said the move reflects the Chinese auto industry's appetite for overseas expansion by purchasing their counterparts' assets.