"We are open to trade partners and at first glance do not see any violations," Merkel told reporters in Berlin, days after Chinese billionaire Li Shufu bought a near 10-percent stake in the Mercedes-Benz parent company, making him the group's largest shareholder.
She noted that there are Kuwaiti investors at Daimler and stressed that the overall objective is to ensure that the automobile industry in Germany stays competitive.
Li's latest investment in Germany's powerful auto company prompted Economy Minister Brigitte Zypries to warn Monday that Berlin will be "especially watchful" over the new major investor.
Daimler confirmed Friday that Li, who chairs auto giant Geely Automobile Holding, had quietly bought a 9.69-percent stake in the Stuttgart firm worth around 7.2 billion euros (USD 8.9 billion).
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Worker representatives on Daimler's board said they too would scrutinise Li's plans, looking to defend factory sites and jobs in Germany.
Some politicians see the investment in a broader context of Chinese cash winding around the sinews of the European economy.
Just last week, the Handelsblatt financial daily reported Berlin hopes to block State Grid Company of China (SGCC) from investing in 50Hertz, which operates the electricity grid in Germany's northeast.
German ministers agreed last year to expand government powers to scrutinise takeover bids from abroad, especially in sectors affecting critical infrastructure, and to extend the range of deals eligible for official probes.
The move followed the 2016 Chinese takeover of industrial robotics firm Kuka and US-based Tesla Motors' buying-up of factory automation specialist Grohmann Engineering.
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