Shares of Dongfeng Motor Halted From Trading Pending Announcement

SHANGHAI--Shares of Dongfeng Motor Group Co. (0489.HK) have been halted from trading on Tuesday pending an announcement, the state-run carmaker said in a filing with the Hong Kong exchange.

Dongfeng is nearing a deal to buy a 14% stake in French carmaker PSA Peugeot Citroën (UG.FR), people familiar with the deal have said.

The Peugeot board is expected to approve a draft agreement on Tuesday. The document could be ratified on March 26, during an official visit of China's President Xi Jinping to Paris, the people said.

Dongfeng spokesman Zhou Mi wasn't immediately available for comment on Tuesday morning.

Peugeot, one of France's largest and oldest industrial companies, is in a race to repair its finances, badly hurt by dwindling sales in its core European markets, and large factories operating well below full capacity.

Dongfeng is China's second-biggest carmaker by volume if its sizable commercial-vehicle sales are included. But the overwhelming majority of Dongfeng's cars are produced with the company's joint-venture partners, which include Japanese auto makers Nissan Motor Co. and Honda Motor Co., and Peugeot.

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