Slaughter and May advised Shenyang Automobile on its USD2.3 billion acquisition of Huachen

Slaughter and May, Hong Kong, acted for Shenyang Automobile, the new State-owned platform for the automotive industry in Shenyang, in relation to its acquisition of 100% of the equity interest (the “Acquisition”) in Huachen Automotive Group Holdings Company Limited (“Huachen”) with an investment amount of up to RMB16.4 billion (USD2.3 billion). The Acquisition was completed on 15 March 2024.

After completion of the Acquisition, Shenyang Automobile has acquired the Huachen group and its businesses and assets as a whole, including 29.99% of the shares in Brilliance China Automotive Holdings Limited (stock code: 1114.HK) and other listed and unlisted assets. Brilliance China Automotive Holdings Limited indirectly holds a 25% stake in a joint venture in the PRC with BMW, BMW Brilliance Automotive Ltd.

The Acquisition was part of a restructuring plan approved by Huachen’s creditors and the Shenyang Intermediate People’s Court. The restructuring of Huachen is the largest in the automotive industry of the PRC to date.

Shenyang Automobile is the new State-owned platform for the automotive industry in Shenyang with a registered capital of RMB4.88 billion.

Established in September 2002, Huachen group is one of the important manufacturers in the independent automobile industry of the PRC. It is a large-scale automobile group integrating R&D, design and manufacture of complete vehicles, engines and auto parts as well as automobile logistics and distribution. It has also successfully created well-known joint ventures and independent automobile brands such as BMW Brilliance, Zhonghua and Jinbei.

Benita Yu, lead partner, comments, “We are delighted to have assisted Shenyang Automobile in overcoming complex regulatory issues to see the completion of its acquisition of Huachen. The indirect acquisition of 29.99% shareholding in Brilliance China by Shenyang Automobile also represents a landmark transaction in the PRC automotive industry. Our heartfelt congratulations to Shenyang Automobile!”