Geely Holdings released a disclosure notice which completes a deal in which the company now assumed ownership of a 14.9 voting stake in AB Volvo. The deal has been pending since December 27 last year when Geely struck a deal to buy activist fund firm Cevian Capital's stake in the Swedish truck and construction equipment manufacturer.
Under the terms of the transaction, Nomura International Plc and Barclays Capital Securities Limited first acquired Cevian's shares, with the intention to sell them to Zeijiang Geely Holding Group, the company that was formerly Geely, while awaiting necessary regulatory approvals. Geely is headquartered in Hangzhou, Zhejiang and has been aggressively acquiring rival companies for almost a decade. In 2010 acquired Volvo Cars from Ford. It acquired The London Electric Vehicle Company in 2013. In June 2017, Geely acquired 49.9 equity in PROTON Holdings as well as a 51% majority stake in Lotus Cars. Geely has been able to turn Volvo Cars around since acquiring it from Ford. Since then, Volvo has built an engine plant and two vehicle assembly factories in China, in addition to another assembly facility in South Carolina. All this, while expanding their research and development centers in Sweden and California.
By the end of this year, the company will have introduced nine models, which has effectively replaced their entire lineup. In 2017, Volvo reported sales of 571,577 vehicles and an operating profit of $1.76 billion, both records for the 91 year-old company. In February, Geely announced it had purchased a stake of almost 10 percent in Germany's Daimler, AB Volvo's main competitor. According to another disclosure notice, the newly acquired shares will be held by Geely Sweden Industry Investment AB.