Geely, Ford to pen Volvo deal today

• Source: Global Times
• [16:19 March 28 2010]
• Comments

Zhejiang Geely Holding Group will sign an agreement with Ford Motor in Sweden at 3 pm local time on Sunday to buy the American money-losing Swedish brand Volvo, according to a report from CNR.cn today.

According to earlier media reports, the expected price for the deal would be $1.8 billion (about 12.3 billion yuan).

The two companies will announce the details of the purchase at a news conference in Gothenburg, the Volvo's hometown Sunday.

Except for Geely Chairman Li Shufu, Volvo Cars Chief Executive Stephen Odell and Ford's Chief Financial Officer Lewis Booth, Li Yizhong, Chinese Minister of Industry and Information Technology will also attend the signing ceremony due to be held in Sweden, said CNR.cn. 

Glenn Magnusson, head of the managers' union at Gothenburg, Sweden-based Volvo, said in an interview that the Volvo union supported the acquisition. "We have received all the information that we were looking for," Magnusson said.

Jia Xingguang, an auto industry analyst, said that earlier in an interview that the purchase was a big step out for Chinese auto industry going overseas. He is positive about Volvo's future, and gives Geely's Chairman a high praise, "Li has a good concern and Geely values Volvo's technologies of safety and environmental protection. And that's strategic."

Ma Guangyuan, a Chinese economist, was careful when he judged the purchase earlier. "Geely faces a big challenge. Signing the deal is only the first step for Geely. Integration is the key for Geely to operate the Swedish brand. Volvo was born in Sweden where people enjoy high welfare, and there are many differences between the two countries," he said.

Agencies and Shi Jierui contributed to this story