Equipment Type

China’s Geely Holding Buys Strategic Stake in Volvo Trucks

Deal worth about $3.3 billion

December 28, 2017

China’s Zhejiang Geely Holding, parent of Geely Automobile holdings and owner of the Volvo car brand, is buying an 8.2 percent stake in the Swedish truck manufacturer AB Volvo from Cevian Capital, worth around $3.3 billion and making Geely the truck manufacturer's largest shareholder.

"Given our experience with Volvo Car Group, we recognize and value the proud Scandinavian history and culture, leading market positions, breakthrough technologies and environmental capabilities of AB Volvo,” Geely Holding Chairman Li Shufu said in a statement on Wednesday.

The deal makes Geely the biggest individual shareholder in AB Volvo and 15.6 percent of Volvo  voting rights behind Swedish investment firm Industrivarden's 22.8 percent.

Daniel Donghui Li, Chief Financial Officer and Executive Vice President of Geely Holding, added: “Geely Holding is a well-recognised strategic long-term investor, and as such we aim to contribute positively to the long-term development of AB Volvo. Geely Holding will be able to contribute its global knowledge, Chinese market expertise and leading research and development capabilities especially in the fields of electrification, autonomous driving and connectivity, to AB Volvo to further its global development, and strengthen the Volvo brand.”

Geely Holding acquired the Volvo Car Group from Ford Motor Company in 2010 but says it has no plans to merge the two Volvo businesses, but sees potential for joint marketing.

Geely Holding also has stakes in the company that makes London’s black cabs, sports carmaker Lotus, the London Electric Vehicle Company, and the Boston-based flying car company Terrafugia Inc.

 

 

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