BMW will invest in Brilliance not because of bankruptcyNovember 17, 2020
This was announced by a company representative.
In 2018, BMW announced that it would invest 3.6 billion euros in 2022 in exchange for a 25% stake in the joint venture with Brilliance. Now a representative of the German brand said that the company is investing in the joint production not because of Brilliance’s debts, but because the funds have already been allocated, and the expansion of production will only benefit.
Interestingly, in recent weeks, China has been shaken by news of the default of a number of large organizations, including Brilliance. However, the structure of the contract implies that 50% of the shares of the joint plant of the German and Chinese company are owned by two entities controlled by Brilliance. Therefore, in case of bankruptcy of the latter, the company will not feel any consequences.
In September, it was reported that a number of government-backed Chinese investors were considering privately using Brilliance following bankruptcy. It is noted that this cannot affect BMW’s plan to increase production and increase its share in the enterprise.
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