Guangzhou Auto lifts Denway privatisation offer

HONG KONG, June 8 (Reuters) - Guangzhou Automobile Group Co Ltd said on Tuesday that it would increase its offer by 25.2 percent to take unit Denway Motors 0203.HK, a carmaking partner of Japan's Honda Motor (7267.T), private.

Guangzhou Auto said it would lift the planned Denway Motor share swap ratio to 0.474026 per share from the previous 0.378610.

Guangzhou Auto, China's sixth-biggest carmaker, announced last month that it planned to issue $3.3 billion in new shares to privatise Denway as part of its own listing. Shareholders were to receive 0.378610 new Guangzhou Auto shares for every Denway share held, implying a value of up to HK$5.49 ($0.704) per Denway share.

Shares of Denway have been under pressure, falling about 21 percent to HK$3.54 since the announcement of the share swap on May 19, which analysts said overvalued Guangzhou Auto shares.

Guangzhou Auto has a 37.9 percent stake in Denway.

Recent strikes at auto parts makers in China have also triggered concern over wage inflation, which auto companies are unlikely to fully pass on to customers, analysts have said. (Reporting by Alison Leung; Editing by Chris Lewis and Jonathan Hopfner)