Volvo To Be Bought By Geely, Ford Confirms

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Dec 24, 2009
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THE SALE OF VOLVO has reached a critical stage, with current owner Ford announcing that it has agreed to "all substantive terms" of Geely's offer to buy the Swedish automaker.

The amount Geely is proposing to pay for Volvo isn't known, but current estimates put that figure around the US$2 billion mark. Ford paid roughly US$6 billion for Volvo when it purchased the company in 1999.

Ford said in a statement that it, "does not intend to retain a shareholding in the business post-sale", however it and Volvo would continue to co-operate in the future. As part of the deal, Geely will also own the intellectual property rights to all current and future Volvo technology.

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The sale is expected to be concluded in the second quarter of 2010, once financing has been secured and approval given by the Chinese and Swedish governments.

Ford says it selected Geely as its preferred buyer for the Volvo brand because of its extensive resources and its assurance that it would not radically alter the brand.

 

"Ford believes Geely has the potential to be a responsible future owner of Volvo and to take the business forward while preserving its core values and the independence of the Swedish brand,” Ford Chief Financial Officer Lewis Booth said.

 

Ford said in a statement issued this week that the sale of Volvo would benefit the American automaker by enabling it to focus on the recovery of its core brand.

 

"The prospective sale would ensure Volvo has the resources, including the capital investment, necessary to further strengthen the business and build its global franchise, while enabling Ford to continue to focus on and implement its core ONE Ford strategy."

 

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Comments

  • Stan H [reply]
    7 months ago 0 points
    As GM has managed to offload exactly none of their dead and dying brands, Ford somehow brought in $4 billion dollars for Land Rover/Jaguar and now Volvo. These are brands which have cumulatively lost Ford on the order of $20-40 billion since they acquired them. If that isn’t some of the best salesmanship of all time I don’t know what is.
  • whatthe [reply]
    7 months ago 0 points
    Who is Geely?
  • bruzzer [reply]
    7 months ago 0 points
    a sad day in motoring world. Volvo will never be the same in years to come. some of the technology Volvo makes is amazing and starting to flow into to FORD cars.
    volvo had lots of potential if FORD had invested more time in the brand....
  • Martin [reply]
    7 months ago 0 points
    whatthe, Geely is a Chinese car company.
  • will [reply]
    7 months ago 0 points
    Q : How do you make a small fortune in the Automotive business?

    A : Start with a big one.
  • Paddy [reply]
    7 months ago 0 points
    Eww, first Saab was on the brink of disaster, now Volvo.
    I'd be really ashamed if I was Swedish knowing the two biggest Swedish carmakers are heading to hell =(
  • auto [reply]
    7 months ago 0 points
    if they were sold at a more realistic price maybe people would buy more of them.

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