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Yapp Auto employees vote down takeover
13/1/2006 11:17

Shanghai Daily news

Employees at Yangzhou Yapp Auto Plastic Parts Co, China's dominant fuel tank maker, have vetoed a takeover proposal from top Belgian chemical company Solvay SA, fearing possible job demotions.
A year ago, Solvay plastic-processing unit Inergy Automotive Systems, a joint venture with Cie Plastic Omnium SA of France, signed a memorandum of understanding to purchase a 55 percent stake in Yapp for an undisclosed sum.
"Employees have rejected the takeover," an official at Yapp's management office said yesterday by phone. "And that's an express of corporate democracy."
State-owned Yapp, based in Yangzhou in eastern China's Jiangsu Province, is a joint venture between the State Development & Investment Corp, China's largest investment holding company, and Shanghai Automotive Industry Corp.
China requires that foreign takeover proposals involving a state company receive majority approval in an employee referendum.
"We're doing things well with SAIC at the moment, so there's no need to introduce foreign capital now," the official said.
Another Yapp official attributed the rejection to employees in the company's research and development center.
Staff in the R&D sector voted against the takeover over concern they would be transferred to factory positions because Inergy planned to make Yapp its manufacturing base in China, the official said.
Yapp's clients in China include big names such as Germany's Volkswagen AG and Ford Motor Co and General Motors Corp of the United States.