Connect with us

Auto

Geely plans to sell $1.32 billion worth of Volvo Truck shares

Published

on

Shares of truckmaker Volvo AB plunged by 5.9% in Stockholm on Friday following the announcement that China’s Zhejiang Geely Holding Group had sold its entire Class B shares, amounting to about 14.1 billion Swedish kronor ($1.3 billion).

In a statement released on Thursday, Geely stated that the divestment aligns with its long-term strategy and reassured that it will remain Volvo’s second-largest investor with 88.5 million A shares. Geely emphasized that the strategic adjustment aims to include AB Volvo in its automotive manufacturing and investment portfolio as part of the group’s risk management and diversified investment strategy.

The sale of 49.5 million shares at 285.9 kronor per share, at a 2.2% discount from its closing price, was facilitated through BofA Securities, Goldman Sachs Bank Europe, and Barclays. This move led to Geely’s listed arm falling more than 3% in Hong Kong on Friday.

Despite the sale, Volvo reported first-quarter operating profit that surpassed analysts’ expectations, indicating the company’s ability to offset waning orders by implementing higher prices. Volvo has been adjusting its production levels as demand returns to normal following the post-pandemic recovery period.

Geely had previously reduced its stake in Volvo in January and also divested some of its holding in Volvo Car AB in November. The company was compelled to rescue Polestar, an electric-vehicle manufacturer it initiated with Volvo Car, earlier this year.

Investors and industry experts are closely monitoring Geely’s strategic moves within the automotive sector as the company navigates through various challenges and opportunities. The article was created from an automated news agency feed without any modifications to the text.

Click to comment

You must be logged in to post a comment Login

Leave a Reply

Trending