Daimler’s major partner BAIC plans to upstage rival Geely

Workers on an SUV production line of the BAIC in Beijing. BAIC Group has started buying Daimler’s shares from the open market. (AFP/File)
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Updated 15 December 2019

Daimler’s major partner BAIC plans to upstage rival Geely

  • The group sets in motion a strategy to double its stake to around 10 percent

FRANKFURT: Daimler’s main China joint venture partner BAIC Group has set in motion a plan to double its stake to around 10 percent and win a board seat in the German luxury carmaker, as it aims to upstage rival Geely, sources said.

State-owned Beijing Automobile Group Co. Ltd. (BAIC), which already owns a 5 percent shareholding in Daimler, has started buying the German company’s shares from the open market, said the sources who were briefed on the matter.

BAIC is currently Daimler’s third-largest shareholder but a stake of 10 percent will make it the biggest shareholder, surpassing its Chinese automaking rival Zhejiang Geely Holding Group which owns 9.69 percent of the German automaker and is seeking to expand its partnership with Daimler in China.

With the shareholding of around 10 percent, BAIC is looking to secure a seat at Daimler’s supervisory board, which Geely does not currently have, the sources said.

HSBC, which advised BAIC on its 5 percent stake purchase in Daimler earlier, is helping the Beijing-based group in the new investment, one of the sources said.

Daimler said in a regulatory filing last month that HSBC held 5.23 percent in Daimler’s voting rights directly as well as through instruments such as equity swaps as of Nov. 15.

Daimler said it had not received any notification about BAIC having raised its stake. Daimler’s China chief Hubertus Troska said on Friday “we welcome long-term investors in Daimler.”

Asked about BAIC and its potential to become a larger shareholder, he added, “we like each other. Let us see how things develop.”

A third source familiar with BAIC’s thinking said that BAIC wanted to be a bigger shareholder than Geely in Daimler in order to be seen as the German automaker’s senior-most partner in China. Reuters reported in November that BAIC had signaled intentions to extend its investment in Daimler, citing sources familiar with the matter. BAIC has been Daimler’s main partner in China for years and operates Mercedes-Benz factories in Beijing through the two automakers’ main joint venture, Beijing Benz Automotive.

Two months before its 5 percent stake purchase was announced in July, sources said that BAIC wanted to invest in Daimler to secure its investment in Beijing Benz Automotive.

The partners also planned to revamp manufacturing facilities to make Mercedes Benz-branded trucks via their commercial vehicle joint venture Foton Daimler Automotive (BFDA), Reuters reported in August citing a document and sources familiar with matter.

BAIC built its 5 percent Daimler stake after Li Shufu, chairman of Zhejiang-based private automaker Geely, built a 9.69 percent stake in Stuttgart-based Daimler in early 2018.


Iran: Oil product exports hit record high despite US sanctions

Updated 22 January 2021

Iran: Oil product exports hit record high despite US sanctions

  • ‘The enemy and Trump wanted us to perish and die, our exports to reach zero’
  • ‘We set the highest record of exports in the history of the oil industry during the embargo period’

DUBAI: Iran has achieved record high exports of petroleum products despite US sanctions, Oil Minister Bijan Zanganeh said in televised remarks on Friday.
Zanganeh said former US President Donald Trump and his secretary of state, Mike Pompeo, had “joined the dustbin of history, but we are alive and working with more hope to build the country.”
“The enemy and Trump wanted us to perish and die, our exports to reach zero,” he said.
“We set the highest record of exports in the history of the oil industry during the embargo period.”
Trump abandoned the Iran nuclear deal in 2018 and imposed sanctions on the Iranian energy and banking sector.
It is estimated that Iran exports less than 300,000 barrels of oil per day (bpd), compared with a peak of 2.8 million bpd in 2018.
US President Joe Biden has said that if Iran resumed strict compliance with the nuclear agreement — under which it restrained its nuclear program in return for relief from economic sanctions — the United States would too.
However, two of Biden’s top national security nominees said on Tuesday that the United States was a long way from making a decision to rejoin the deal.
Iran has significantly increased exports of petroleum products in recent years although oil products, like crude, fall under US sanctions.
Unlike crude oil, where the ultimate buyer is a refinery, other products can find their way to potentially thousands of small-scale industrial or residential buyers, making them difficult to trace.