July 4, 2014 / 9:16 AM / 3 years ago

BAIC Motors hires banks for $2bln Hong Kong IPO

HONG KONG, July 4 (Reuters) - Chinese carmaker BAIC Motor Corporation Ltd, part-owned by Daimler AG, has hired four banks for a Hong Kong initial public offering worth up to $2 billion.

The company has hired HSBC, CITIC Securities International, Deutsche Bank and UBS AG, according to a prospectus filed with the Hong Kong Exchange.

Reuters had earlier reported that Goldman Sachs and Morgan Stanley were also working on the planned listing for state-backed BAIC Motor.

The planned listing comes as passenger car sales continue to grow in China even as the economy slows. In the first five months of the year, China sold 9.84 million vehicles, up 9 percent from a year earlier, according to the China Association of Automobile Manufacturers.

China's passenger vehicle market is the world's largest and is growing at 14.8 percent a year. Last year, 17.9 million units were sold, up from 10 million in 2009, according to All China Marketing Research.

BAIC Motor is the passenger car unit of ambitious state-owned Beijing Automotive Group (BAIC). In November, high-end German auto maker Daimler sealed a deal to buy a 12 percent stake in BAIC Motor for 640 million euros to boost its China presence and secure a foothold before the long-expected IPO.

BAIC also has a joint venture with South Korea's Hyundai Motor Co, and makes cars under the Mercedes-Benz and Hyundai brands.

The listing could fund Beijing Automotive Group's ambition to join the ranks of SAIC Motor, Dongfeng Group and FAW Group as the government tries to consolidate the industry and form globally competitive companies, Reuters previously reported. (Reporting by Stephen Aldred and Norihiko Shirouzu; Editing by Miral Fahmy)

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