Brilliance China Automotive Holdings Ltd said it will receive 500 million yuan (US$73 million) in capital injection from its major shareholder to improving liquidity.
The Shenyang-based auto maker, which specializes in minibus and cars, plans to sell 1.31 billion new shares, at 43 Hong Kong cents (55 US cents) a share, to its controlling shareholder Huachen Automotive Group Holdings, said its statement to Hong Kong's exchange yesterday.
The issue price represented a premium of about 10.3 percent to the closing price of 39 HK cents on Monday.
Brilliance said the proceeds from the share sale will be used to reduce the company's debt and for working capital of Shenyang Brilliance JinBei Automobile.
"The price of the shares has been adversely impacted by the current financial turmoil and the negative market sentiment," the statement said. "It (the injection) will provide Brilliance with additional cash to strengthen its financial position and to better equip the car maker in weathering the economic downturn."
As the share sale represents 26.36 percent of Brilliance Auto's enlarged share capital, Huachen's total stake will rise to 55.38 percent after the deal from 39.41 percent now.
(Shanghai Daily December 4, 2008)
