Troubled German automotive supplier Saargummi is on the verge of being taken over by state-owned Chinese firm Chongqing Light Industry & Textile Group (CQLT).
The Saargummi group supplies rubber sealants to carmakers including Volkswagen, Daimler and BMW in Germany and also exports around the world. In 2010 it employed 4,400 across 23 companies and 12 production sites worldwide. Its revenues were Eu360m, of which Eu320m were attributable to the automotive industry.
However, its German arm was forced to file for insolvency last November after funds ran dry and efforts to refinance the company bore little fruit.
The administrators appointed to the company, Schultze & Braun, say a deal to sell the entire group to CQLT is nearing completion, with finance secured from two banks. Since 2006, CQLT and Saargummi have been engaged in joint venture to supply the Chinese market. The administrators say the deal will preserve the majority of jobs across the group.
Headquarted in the 30 million population city of Chongqing, CQLT has annual revenues of USD1.9bn and 26 locations worldwide.