Geely Automobile, a subsidiary of Zhejiang Geely Holding Group Co., already holds a 20 percent stake in Manganese Bronze. Manganese is offering to sell 20,000,000 new shares of common stock to Geely to increase the Chinese company's stake to 51.7 percent.

Will Geely accept the offer? "The company may or may not proceed with the negotiation of the potential subscription," Geely said in a statement filed with Hong Kong stock exchange.

Lin Huaibin, an auto market analyst with IHS Global Insight in Shanghai, said Geely is not very likely to buy a bigger stake in Manganese Bronze.

"Geely bought DSI (Australian Drivetrain Systems International, a transmission supplier) last year, and is in the process of acquiring Volvo. These all happened in such a short period of time," he said.

If Geely buys more shares, it could run short of capital and management expertise to manage all of its newly acquired assets, he cautioned.

"Plus the fact that Manganese Bronze is not a strong brand, and it won't help Geely much in terms of improving brand image," he added.

After acquiring the stake in Manganese Bronze E in 2007, Geely established a joint venture with Manganese to produce the TX4 taxi in Shanghai for the Chinese market.

In March, Manganese Bronze announced plans to shift production of the taxi's body and chassis production to Shanghai in a bid to cut costs. But final assembly of the TX4 cab will remain in England.