By Ben Otto

SAIC Motor HK Investment intends to acquire a 28.92% stake in troubled car-rental company CAR Inc. for about 1.90 billion Hong Kong dollars (US$245.1 million).

CAR, China's largest car-rental company, said in a stock-exchange filing late Thursday that substantial shareholder UCAR signed a preliminary deal to sell SAIC HK 442.7 million shares of CAR. Proceeds from the sale will be used to repay CAR debt.

SAIC HK, a unit of Shanghai-listed SAIC Motor Corp., has also signed a preliminary deal to acquire 169.6 million shares from another substantial shareholder, Amber Gem Holdings, CAR said. Amber Gem, a unit of U.S. private-equity firm Warburg Pincus LLC, will remain a CAR shareholder.

CAR said SAIC HK intends to pay HK$3.10 for each CAR share, about a 23% premium to the stock's last traded price. It said the deals are still under negotiation and subject to regulatory approvals.

CAR shares have fallen more than 50% so far this year amid troubles at Luckin Coffee Inc., a Nasdaq-listed cafe operator chaired by CAR's former chairman Lu Zhengyao. The former chairman, who controls UCAR, resigned from his position at CAR last month.

Luckin Coffee had disclosed in April that employees fabricated much of its 2019 sales figures, raising investor concerns about CAR's operations. 



  Write to Ben Otto at ben.otto@wsj.com