SHANGHAI, Jan 17 - International Business Machines Corp has bought a strategic stake in Sichuan Changhong Electric Co for 108 million yuan ($15.8 million), the major Chinese television and consumer electronics maker said on Saturday.
A Chinese unit of IBM bought the 1.56 percent stake through the Shanghai Stock Exchange on Friday from the Changhong group, Sichuan Changhong's biggest shareholder, which saw its shareholding reduced to 29.08 percent from 30.64 percent.
Sichuan Changhong did not elaborate on any future expansion of ties with IBM, which did not previously own a stake in the Chinese company.
In December 2007, China's securities regulator blocked a deal under which Microsoft Corp. was to have bought a nearly 1 percent stake in Sichuan Changhong for $12.9 million, apparently because it felt the purchase price was too far below the market price of the Chinese firm's shares.
Sichuan Changhong's shares closed at 3.59 yuan on Friday, near the price of 3.64 yuan per share at which IBM bought its stake. They have plunged from a peak of 13.00 yuan in mid-2007 as the firm's earnings have been slashed by the global economic slowdown and an earthquake which damaged its facilities last May.(Reuters)
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