Pacific Century Motors (PCM), a joint venture between Tempo Group and the Beijing municipal government, completed the acquisition of General Motors' steering-parts manufacturing unit on Tuesday, setting a record for the biggest single overseas purchase in China's automobile parts industry.

The takeover of Nexteer Automotive involves its global steering and half-shaft operations, including 22 manufacturing facilities, six engineering facilities and 14 customer support centers, which have 8,300 employees in North and South America, Europe and Asia, said General Motors.

Both sides declined to disclose further details of the sale. However, the deal was estimated to be between $420 million and $450 million, according to industry insiders. That far surpasses the previous record of $100 million for an overseas acquisition made by China's Beijing West Industries Co Ltd last year.

Also partly-owned by the Beijing municipal government, BeijingWest purchased machinery and equipment, intellectual property rights and certain customer and supplier contracts from the global suspension and brakes businesses of the US-based parts maker, Delphi.

"We are aiming to make Nexteer the most powerful and influential supplier in the world," said Zhao Guangyi, chairman of Pacific Century, during the signing ceremony at Nexteer's headquarters at Saginaw, Michigan.

Zhao promised that after the transaction, Pacific Century will retain Nexteer's Saginaw base, and its manufacturing operations, brands and existing contracts .

Moreover, General Motors told China Daily that Nexteer is recruiting 100 new engineers for the development of its new global business.

According to a Bloomberg report, Zhao also expressed interest in more US takeovers. "We haven't finalized any, but we believe we will have more in the near future," Zhao said.

The automotive industry is global, and worldwide capabilities are important for any supplier looking to compete successfully. Thus the deal is a win-win situation for Chinese and US companies, said analysts.

"The takeover of Nexteer allows the Chinese auto parts maker to quickly master the world's core and leading technologies, in a bid to satisfy the increasing demand from China's booming automobile industry, and improve the global reputation and influence of China's rising auto parts industry," said Fu Yuwu, secretary general of the Society of Automotive Engineers of China.

"It also allows the Chinese automotive market access to valuable technology, including a power-steering system that can improve a vehicle's fuel economy by up to 4 percent," said Nexteer's Chief Executive Robert J. Remenar.

The sale will enable the century-old Nexteer, the fourth-largest steering-parts supplier by market share, to take greater advantage of the rapidly growing Asian automotive market, said General Motors in an e-mail to China Daily.

A diverse customer base is essential to Nexteer's long-term future and this sale provides more opportunities to aggressively pursue new business opportunities and technologies, it added.

Beijing-based analyst Zhong Shi said that the deal is also a positive move for General Motors as the company, which made its stock market debut in mid-November, looks to shed non-core business.