ISTANBUL (Turkey), May 16 (SeeNews) – Turkish commercial vehicles and parts maker Karsan Otomotiv [BIST:KARSAN] said it has signed a preliminary agreement with Chinese company Wuhan Zhong Yuan Bang Tai Investment Holding Co. Ltd to establish a joint venture (JV) firm in China.
The planned joint entity will target to annually produce some 30,000 units of Karsan’s J10 minibus and other Karsan products, the Turkish company said in a bourse filing on Thursday.
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Karsan will hold a 35% stake in the JV which is expected to have a registered capital of 62 million euro ($85 million).
Karsan said earlier that it had signed a letter of intent to sell its J10 production line and know-how to China’s Hubei Suizhou Yongsheng Technology and Trade Company Ltd for 18 million euro. During the talks for a definitive agreement between the two companies Hubei Suizhou Yongsheng Technology and Trade Company Ltd was acquired by Wuhan Zhong Yuan Bang Tai Investment Holding Co. Ltd, Karsan explained.
The Turkish vehicles maker intends to use the proceeds from the sale of the J10 production line to partly finance its share in the planned JV.
($ = 0.729 euro)