HONG KONG/SHANGHAI (Reuters) - Chinese automaker Great Wall Motor Co Ltd 601633.SS reiterated its interest in Fiat Chrysler Automobiles NV FCHA.MIFCAU.N on Tuesday, but said it had not held talks or signed a deal with executives at the Italian-American automaker.

A specialist trader works at the post where Fiat Chrysler Automobiles is traded on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 8, 2017. REUTERS/Brendan McDermid

China’s largest sport utility vehicle (SUV) manufacturer made a direct overture to Fiat Chrysler on Monday, with an official saying the company was interested in all or part of FCA, owner of the Jeep and Ram truck brands.

Automotive News first reported the news, quoting Great Wall Motor President Wang Fengying as saying she planned to contact FCA to discuss acquiring the Jeep brand specifically.

Those comments sent FCA shares higher - but also raised questions over the ability of China’s seventh-largest automaker by sales to buy larger Western rival FCA, or even Jeep, which some analysts value at as much as one-and-a-half times FCA.

Great Wall sought to dampen speculation on Tuesday. It confirmed it had studied Fiat Chrysler, but said there was “no concrete progress so far” and “substantial uncertainty” over whether it would eventually bid.

“The company has not built any relationship with the directors of FCA nor has the company entered into any discussion or signed any agreements with any officer of FCA so far,” the company said in an English-language stock exchange filing.

It did not give further detail.

Fiat Chrysler stock dipped on the statement on Tuesday. Great Wall said trading in its Shanghai-listed shares would resume on Wednesday after having been suspended.

Fiat Chrysler declined to comment on Great Wall’s statement. On Monday, it said it had not been approached and was fully committed to implementing its current business plan.

FLUSHING OUT RIVALS?

Great Wall Motor, which was early to spot China’s love of SUVs, had revenue of $14.8 billion last year and sold 1.07 million vehicles - but that compares with FCA’s 2016 revenue of 111 billion euros ($130.6 billion).

Analysts said Great Wall would need to raise both debt and equity to complete any deal, meaning its chairman Wei Jianjun could lose majority control.

One possible scenario, according to analysts at Jefferies, would see Wei keeping a roughly 30 percent stake, while Great Wall would raise $10-$14 billion in debt and $10 billion in equity - hefty for a group currently worth just $16 billion.

Ultimately, politics could be the clincher.

Any bid now - and it would potentially be one of China’s largest ever overseas deals - would come at a time when Beijing is trying to limit extravagant Chinese purchases abroad, and when the political environment has cooled in the United States.

China’s cabinet on Friday issued rules on overseas acquisitions for the first time.

And the autos sector would also prove sensitive in both Europe and the United States, analysts said.

For FCA, for now, Great Wall’s approach may be more about flushing out rival interest.

European bankers said Fiat would likely consider doing a deal with a Chinese firm only if they could pay cash and bid for the whole company.

“FCA ... is very much expected to use Great Wall’s interest to get to speak to all major EU car makers and ‘offer’ them a chance to get involved in the consolidation game,” said one banker, who asked not to be named.