SHIZUOKA – Suzuki Motor Corp. said Tuesday it has reached a basic accord with General Motors Corp. of the United States to buy an equity stake in a new company to take over the operations of bankrupt South Korean automaker Daewoo Motor Co.
Suzuki, Japan’s largest minivehicle maker and a part of the GM group, did not reveal the size of its planned investment in the company, tentatively to be named GM-Daewoo.
Industry sources said Suzuki will probably put up some 10 percent of the capital, or about a sixth of a 67 percent stake to be held by the GM group.
GM purchased Daewoo’s assets in April. As a group, GM has a 20 percent stake in Suzuki.
Suzuki, based in Hamamatsu, Shizuoka Prefecture, said it is continuing talks with GM on a prospective business tieup with GM-Daewoo. Suzuki is eyeing jointly developing small cars, mutually supplying and purchasing auto components, and selling Suzuki’s cars by using Daewoo’s sales network to gain a larger market share in South Korea.
Suzuki’s investment in South Korea will follow its acquisition in May of a 54.2 percent majority stake and management control in Maruti Udyog Ltd., India’s largest carmaker, set up by Suzuki and the Indian government.
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