Geely plans $250 mln bond issue, not for Volvo

• Source: Gasgoo.com
• [14:01 September 17 2009]
• Comments

Geely Automotive, the Chinese carmaker whose parent is eyeing Ford's Volvo unit, plans to issue convertible bonds and warrants worth $250 million, the China Business News said Thursday.

The newspaper did not say where the proceeds would be invested but cited an unnamed Geely executive as saying the offering was not related to Volvo.

"The size of the bond and warrant issue is not enough compared with what would be needed for the Volvo takeover," the executive was quoted as saying.

Geely said last week its parent was considering a bid for Volvo with a local government-backed investment firm.

Its Hong Kong-traded shares were suspended on Wednesday pending an announcement on a proposed convertible bond issue, which executive director Lawrence Ang also told Reuters late on Wednesday was not related to Volvo.

Analysts said the bonds could be used for Geely to expand its car making capacity rather than launch an immediate bid for Ford's $2 billion-plus Swedish car unit.

(Reuters)