DaimlerChrysler and Hyundai Motor Company have agreed to form an alliance under the terms of which DaimlerChrysler will acquire through today’s agreement, a 10 % stake in Hyundai for $ 428 million.
A letter of intent and stock purchase agreement will be signed today in Seoul by President Lee Kye-Ahn and President Kim Dong-Jin of Hyundai, and Dr. Eckhard Cordes and Dr. Dieter Zetsche, Members of the Board of Management of DaimlerChrysler AG. The letter of intent will specify three key areas of cooperation:
- a 50/50 joint venture for the development, production and marketing of commercial vehicles;
- an alliance for the development and production of passenger cars;
- to submit a non-binding bid for Daewoo Motor Company to investigate the merits for the alliance between Hyundai Motor Company and DaimlerChrysler.
Juergen E. Schrempp, Chairman of DaimlerChrysler AG, said the alliance would create exciting opportunities for DaimlerChrysler to produce and market cars and commercial vehicles in Asia and other parts of the world.
“Hyundai Motor Company is an ideal partner to expand DaimlerChrysler’s growing presence in Asia. Hyundai is successful, profitable and by far the strongest player in the Korean automotive market. It has an excellent distribution network throughout Asia and in particular the fast-growing Asean countries. The commercial vehicle joint venture will also further strengthen our position as the number one commercial vehicle producer in the world,” Juergen E. Schrempp said.
Mr. Chung Mong-koo, Chairman of Hyundai Motor Company said the new relationship would enable Hyundai to align itself with one of the leading global automotive groups, while preserving its independence.