BEIJING, June 5, 2013 /PRNewswire/ -- Lentuo International Inc. (NYSE: LAS) ("Lentuo" or the "Company"), a leading non-state-owned automobile retailer headquartered in Beijing, today announced that it has received approval from the Beijing government for its joint venture ("JV") with Itochu Corporation. The approval was granted by the Beijing Municipal Commission of Commerce ("BMCC") in May, 2013.
The BMCC, a department under the Beijing Municipal Government, handles all work related to foreign direct investment within Beijing. Its main duties include examining and approving the acquisition of domestic enterprises as well as the establishment of joint ventures involving foreign investors. Following the approval, the Company has begun filing for the JV's business registration.
The JV will focus on the expansion of Lentuo's high-end car dealerships across China, starting with the new Audi 4S dealership located in southern Beijing, the construction of which was announced by the Company in November, 2012. The JV will also scale up its higher margin repair and maintenance services.Itochu will invest RMB300 million and take a 40% stake in the JV. Having successfully built its subsidiary Yanase into the largest Mercedes dealership in Japan, and with its extensive experience in operating and investing in high-end car dealerships across Asia, Itochu will also act as a strategic investor to help Lentuo strengthen its management and business operations over the long run. "We are very pleased that the Beijing Municipal Commission of Commerce has approved the joint venture with Itochu," commented Mr. Hetong Guo, Founder and Chairman of Lentuo. "The approval marks the most critical step in the series of government approvals we must first obtain before operations can begin."