29 December, 2017
Chinese privately-owned automaker Zhejiang Geely Holding Group has agreed to buy an 8.2% stake in Swedish truckmaker AB Volvo from Europe's largest activist fund manager, Cevian Capital.
The deal will make Geely the largest individual shareholder in AB Volvo. Under the terms of an agreement signed by Daniel Donghui Li, Chief Financial Officer and Executive Vice President of Geely Holding and Cevian in the presence of Christer Gardell, co-founder of Cevian, Geely Holding has committed to acquire Cevian's 88.47 million A-shares and 78.77 million B shares in AB Volvo, a press release from Geely reads.
Geely Holdings, the parent company of Volvo Cars, has just made a large investment in Volvo Trucks. "We will support the Board of Directors and the management of AB Volvo in their continued execution of the current strategy".
The value of the transaction was not revealed. Volvo Trucks is one of the world's leading manufacturers of heavy trucks but it needs the assistance of a company better entrenched in the rapidly expanding Chinese market.
Volvo shares have gained more than 50 percent this year as it and rivals in the truck industry such as Germany's Daimler and Volkswagen hit a sweet spot thanks to robust demand in major markets.
Gujarat: Independent MLA declares support to BJP
This is the first time he was speaking after chairing his first CWC meeting as the Congress president with his mother Sonia Gandhi seated next to him.
Lynk & Co, a joint venture between Volvo Cars and its parent group Geely, started selling its first model last month, joining the competition in the mainland's mainstream vehicle segment which is dominated by foreign brands including Volkswagen, General Motors, Ford and Toyota.
So, will this mean a reuniting of the truck and construction vehicle arm of Volvo with Volvo Automobiles?
In June, Geely Holding bought 49.9 per cent of Malaysian carmaker Proton and 51 per cent of iconic British sports auto marque Lotus Cars. It is believed Geely paid about £2.5bn for the stake. Industrivarden controls 22.8 percent of the votes.
Selling the stake in the company was Cevian Capital - an investor group.