By Engen Tham and Ilona Wissenbach

(Reuters) -Foxconn’s two-year pursuit of a stake in a unit of German auto supplier ZF Group stalled last month due to a substantial mismatch in valuation expectations and a higher-than-estimated debt pile, according to documents seen by Reuters.

The findings from the Taiwanese firm’s due diligence were circulated days before ZF Group said in October that it would abandon its plans to spin off its powertrain technology unit, known as Division E.

The unit produces electric, conventional and hybrid systems for the automobile sector. Foxconn was considering buying a stake in it as part of its expansion in the electric vehicle (EV) business.

Now, ZF Group is in talks with Foxconn and other interested parties about partnerships covering specific products in

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