U.S. auto giant General Motors has sold its Michigan-based steering gear manufacturer Nexteer to a Chinese investment group.
Pacific Century Motors, an entity formed by The Tempo Group and an affiliate of the Beijing municipal government, will acquire all of Nexteer's operations, which has 6,200 employees around the world including China.
The deal includes 22 manufacturing plants, six engineering facilities and 14 customer-support centers in North and South America, Europe and Asia.
Terms of the sale, which is expected to close by the end of the year, were not disclosed.
"The sale of Nexteer to PCM supports our objective to focus on our core auto business and is the final step in our efforts to position Nexteer as an independent supplier," a statement from GM said.
"The sale better enables Nexteer to take advantage of anticipated growth in the global auto industry with a variety of automakers," said GM vice chairman for corporate strategy and business development Stephen Girsky.
"Ultimately, it's a move we believe will make it a more vibrant and healthier business."
Nexteer's headquarters will remain in Saginaw, Mich., and PCM said it intends to honor the terms of the new five-year labor agreement.
"Today's announcement reflects a win-win situation," said Zhao Guangyi, chairman of PCM and its affiliate E-Town Development Area.
"The new ownership will provide access to not only continued capital investment but also new growth opportunities, which will allow Nexteer to continue its growth worldwide in technology and manufacturing, and particularly enable greater access to untapped business in the China market," Zhao said.
GM reported a post-bankruptcy quarterly profit in May for the first time in three years on the back of a jump in sales and cost-cutting measures.
Copyright Agence-France Presse, 2010