The Car and Truck Fleet and Leasing Management Magazine

China's Geely to Buy Stake in Volvo Trucks

December 27, 2017

Volvo Trucks North America executives pose with a VNL tractor at the truck's launch earlier this year. Photo: Jack Roberts
Volvo Trucks North America executives pose with a VNL tractor at the truck's launch earlier this year. Photo: Jack Roberts

A busy year in trucking refuses to go out with a whimper, as new reports broke Wednesday that China’s Geely Holding is buying an 8.2% stake in Volvo Trucks. The shares will be purchased from the Cevian Capital investor group for approximately $3.3 billion, according to published reports.

Geely already owns the Volvo automobile group, which was divested from the Volvo trucking and construction business almost 20 years ago. But Geely says it has no intention of trying to reunite the two businesses.

The deal will make Geely the largest individual shareholder in AB Volvo, ranked second behind Swedish investment firm Industrivarden in terms of voting rights.

According to the deal, Geely will acquire 88.5 million A shares and 78.8 million B shares to give it 15.6% of Volvo voting rights. Industrivarden owns mostly A shares and controls 22.8% of the votes.

“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 Chairman Li Shufu said in a statement as the deal was announced.

Shufu noted that the deal would be mutually beneficial for both Volvo and Geely, given his company’s expertise in the Chinese commercial vehicle market and in developing electric and autonomous vehicle technologies.

Volvo also currently owns 45% of Dongfeng Commercial Vehicles, one of China’s largest truck makers, and has a significant construction equipment business in China.

According to reports by Reuters, the value of the investment amounted to around 27.2 billion Swedish crowns ($3.26 billion), although Geely and Cevian did not disclose the exact value of the transaction.

Twitter Facebook Google+

Comments

Please note that comments may be moderated. 
Leave this field empty:
 
 

  1. 1. JM [ December 31, 2017 @ 10:54AM ]

    So we are at odds with the Chinese government and moving always from their products and exports, especially all the contaminated junk they peddle to us, but Volvo is making billion dollar deals with them. I hope the Volvo interiors don’t have any formaldehyde in them, and there is no lead in the paint. They poisoned thousands of kids with contaminated milk, but Volvo is giving them a strong position in their company. Got it !!

  2. 2. JM [ December 31, 2017 @ 11:00AM ]

    https://www.npr.org/templates/story/story.php?storyId=11656278

  3. 3. R.J. [ December 31, 2017 @ 11:30AM ]

    Just ANOTHER reason NOT to buy a volvo. Fix or repair weekly should be their motto. I wont buy Cummins products either as they are being made in China. Local fella bought a new (Loaded) head for a cummins engine. Many of the holes did not line up and had to be elongated by local machine shop.
    The head was not flat and had to be re-surfaced with a shim installed.
    Expensive US dollars for cheap chinese junk. Only Cummins is benefitting! ! !

 

FleetFAQ

Fleet Tracking And Telematics

Todd Ewing from Fleetmatics will answer your questions and challenges

View All

 

Fleet Management And Leasing

Merchants Experts will answer your questions and challenges

View All

 

Up Next

More From The World's Largest Fleet Publisher