Wires

HOLD-PSA readying sale of its stake in Chinese tie-up with Changan

PARIS/BEIJING, Nov 28 (Reuters) - Peugeot maker PSA Group is preparing to sell its 50% stake in a joint venture with Chongqing Changan Automotive, a Chinese partner also exiting the manufacturing tie-up, a spokesman for the French carmaker said on Thursday.

Changan had already signalled in regulatory filings from early November that it was seeking a buyer for its half of the venture, which builds cars under PSA's DS brand. It was set up in 2011 and has struggled with falling sales.

PSA is also looking to sell out of the venture, known as Capsa, a spokesman confirmed, though the group added that it would still look to roll out DS in China, without giving further details of how.

"The two partners plan to sell their stakes in their joint venture," the spokesman said. "That does not change anything regarding DS's presence and development in China, a new strategic plan will be presented in the coming weeks or months."

PSA's sale plan for the joint venture, which operates a factory in Shenzhen, will be presented to French unions on Friday, a source familiar with the matter said. (Reporting by Gilles Guillaume and Yilei Sun; Writing by Sarah White; Editing by Geert De Clercq)