Chinese vehicle maker Zhejiang Geely Holding Group said Wednesday that it would by a $3.23 billion stake in Swedish truck and bus company Volvo AB, another sign of Chinese companies' appetite for global auto assets, The Wall Street Journal reports.
Geely's move to buy Volvo will help further strengthen its worldwide presence after its 2010 acquisition of Volvo Cars from Ford Motor Co.
Geely has surprised the automotive world with its resurrection of Volvo Cars since its acquisition of the Swedish carmaker in 2010.
"Geely Holding will be able to contribute its global knowledge, Chinese market expertise and leading research and development capabilities especially in the fields of electrification, autonomous driving and connectivity, to Volvo to further its global development, and strengthen the Volvo brand", he said.
The deal will make Geely the largest individual shareholder in AB Volvo.
Selling the stake in the company was Cevian Capital - an investor group.
China's Geely Auto has purchased a $3.8 billion (Rs 24,004 crore) stake in Volvo Trucks, making the Chinese owner of Volvo Cars the biggest shareholder of the truck-making Volvo Group, as per the Financial Times. Geely and Cevian declined to disclose the exact value of the transaction.
AB Volvo also makes buses, construction equipment, diesel engines and industrial engines.
Li Shufu, chairman of Geely Holding, said he was delighted by the deal.
According to the news feature, this would make the deal the most lucrative exit ever by an activist, according to Nomura, topping the €2.7 billion (Rs 20,638 crore) Icahn Enterprises made past year when selling American Railcar Leasing.
Geely has also formed an electric-vehicle joint venture with Volvo Cars, pledging an investment of 5 billion yuan (US$758 million) to support Polestar-branded high-performance electric cars.