Daimler in talks with China's sovereign wealth fund

Apr. 23, 2009 (China Knowledge) - Daimler AG, the world's second-largest maker of luxury cars, is in talks with China's sovereign wealth fund China Investment Corp (CIC) about the possible capital injection into the German automaker, said Daimler's Chief Executive Dieter Zetsche, the Frankfurter Allgemeine Zeitung newspaper reported on Tuesday.

The possible investment from CIC would be encouraging for Daimler, which is undergoing financial difficulties at the moment, said Zetsche, adding that the two sides have met several times in the past, and talks have not in principle been broken off.

A spokesman for Daimler said the company constantly held talks with current and potential investors.

Lou Jiwei, chairman of the US$200-billion sovereign wealth fund, said at the Boao Forum that CIC will consider investing in Europe this year.

CIC, which has stakes in Morgan Stanley and Blackstone Group, posted US$10 billion of profit last year, representing a 5% return, according to earlier media reports.