Chinese state-owned car maker FAW Group had held talks to acquire Italian truck group Iveco earlier this year but these had now been put on hold, two Reuters sources said.
FAW made a preliminary offer in July, valuing Iveco at a little more than EUR3bn euros ($3.5bn), a Reuters sources said. The source said Iveco's parent CNH Industrial rebuffed it because it considered the valuation low.
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Changchun-based FAW, which makes heavy duty trucks under its own brand, is now reluctant to make international deals so as not to be seen to take advantage of troubled companies during the COVID-19 pandemic, the second source said. Some European governments have sought to shield key industries from unwanted foreign interest this year, as the coronavirus pandemic hit companies across sectors.
Reuters noted vehicle and equipment maker CNH Industrial said last year it planned to split the company into two and list its lower-margin Iveco truck and bus business, along with the FPT engine division, in an effort to boost the group's asset values and streamline its businesses but the plans had been delayed.
Iveco makes vans in China with state-owned SAIC Motor, the report said.
A sale of Iveco would be an alternative to the planned spin-off initially aimed to be finalised in early 2021, but which had been delayed "into next year or beyond" due to the fallout of the coronavirus crisis, CNH Industrial told Reuters.
