Guangzhou Auto mulls deal with Indian tech firm

Hong Kong, May 8: Chinese carmaker Guangzhou Automobile Industry Corp. is in talks with Indian technology firm Xenitis Group on co-operation in building two and four-wheeled vehicles, a Hong Kong newspaper reported on Tuesday.

The South China Morning Post quoted a source from the Chinese company as saying it would be Guangzhou Automobile's first overseas investment if the deal was closed.

It gave no investment or financial details.

Xenitis, which planned to diversify into the vehicle manufacturing business next year, had earlier entered into a technology transfer agreement with the Chinese carmaker to set up a production unit of two wheelers in West Bangal, the paper said.

Guangzhou Automobile holds about 38 percent of Denway Motors Ltd. , the newspaper said.

State media had reported in March that Guangzhou Automobile, a joint venture partner of Honda Motor Co. and Toyota Motor Corp. , aimed for a listing on the stock market this year to fund development of its own-brand vehicles. Chinese media had reported that the carmaker planned to float shares in Hong Kong, raising as much as US0 million.

Reuters>