China’s Geely Buys Stake in Sweden’s AB Volvo
Seven years after buying the Volvo car brand, the automaker buys reported $3.3 billion stake in truck manufacturer.
Geely, the Chinese owner of the Volvo car brand, is acquiring a piece of truck maker AB Volvo.
The purchase from fund manager Cervian Capital of an 8.2 stake in the Swedish truck manufacturer widens Geely's holdings, which already include a stake in Britain's Lotus and Malaysia's Proton. Terms of the latest transaction were not disclosed, but it's reported market value was around $3.3 billion.
AB Volvo was the parent of Volvo Cars up until its sale to Ford Motor in 1999. Geely purchased Volvo Cars in 2010.
"We recognize and value the proud Scandinavian history and culture, leading market positions, breakthrough technologies and environmental capabilities of AB Volvo," Geely chairman Li Shufu said in a statement.
The deal makes Geely the largest single shareholder in Volvo and the second biggest in terms of voting rights.
Christer Gardell, co-founder of Cevian, said that the transaction gives AB Volvo a "large and committed shareholder," and with one with expertise in strategically important areas, alluding to the Chinese market and its expertise in areas including electric cars.
Geely, the owner of one of China's largest independent automakers, earlier in the year purchased a near 50 percent stake in Proton and a 51 percent piece of Lotus.