BMW Group agrees Long-term Expansion of the Joint Venture BMW Brilliance Automotive Ltd. in China

The BMW Group intends to increase its stake in the BMW Brilliance Automotive Ltd. ('BBA') joint venture from 50 percent to 75 percent. The company has signed an agreement with its joint venture partner, a subsidiary wholly owned by Brilliance China Automotive Holdings Ltd. ('CBA'), to acquire an additional 25 percent shareholding in BBA. The two partners agreed on a purchase price of an equivalent of 3.6 billion euros. The contractual term of the joint venture, which would currently expire in 2028, is to be extended to 2040 as part of the agreement.

The strategic goal pursued by the BMW Group is to further strengthen its long-term cooperation with CBA, increase production capacity at the existing sites in Shenyang and continue to expand the localization of additional models including 'new energy vehicles' ('NEVs').

The prerequisite for the aforementioned strategic steps in China is the acquisition of the additional shares. This transaction is subject to the approval of the relevant authorities and the consent of the CBA Shareholders' Meeting.

Based on the current situation, the deal is scheduled to close in 2022, the year in which the joint venture requirement for auto manufacturing in China ends. The closing will result in BBA being fully consolidated in the BMW AG's Group financial statements and is accordingly expected to have a significant positive valuation effect in the financial year in which the deal closes.