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SHANGHAI, Aug 29 (Reuters) - Tianjin Automotive Xiali Co said on Thursday its parent would sell a controlling stake in the listed company to China's largest car maker, First Automotive Works (FAW), for 1.42 billion yuan ($171.6 million).
The parent, Tianjin Automotive Industry Corp, signed an agreement with FAW on Monday to sell 50.98 percent of Tianjin Xiali, the listed company said in a statement published in the official Securities Times.
The 739.29 million state-owned institutional shares, accounting for 60 percent of a total 84.97 percent stake Tianjin Auto owned in the listed company, would be sold at 1.9229 yuan per share, the statement said.
"After both sides consulted and agreed, Tianjin Auto and FAW signed the agreement on Monday," the statement said.
"The price was set in reference to our company's audited net asset value per share by June 30, 2002," it said.
The deal also includes a one-for-10 bonus share offer issued by Tianjin Xiali on July 29 based on its 2001 outstanding shares, the statement said.
This would bring the actual shares Tianjin Auto transferred to Faw to 813.22 million shares, although the 50.98 percent remained the same, the statement said. It did not say when the sale would be completed.
Tianjin Auto, China's fourth largest car producer, announced in June it was selling the stake but did not put a value on the deal.
The tie-up is the biggest so far in the domestic automobile market.
($1 = 8.276 yuan)