Anton Andres / Daimler, Volvo | February 27, 2018 12:11
Geely chairman Li Shufu becomes largest stakeholder in Daimler
Geely chairman Li Shufu buys a significant chunk of shares from Daimler. With $ 9 billion placed in Daimler, he singlehandedly becomes the largest stakeholder in the German Automaker, accounting for 9.69 percent of the company.
Li Shufu is keen on global expansion as they also bought a 49.9 percent share of Lotus under Geely. With the deal with Daimler in place, the Chinese automaker fully owns one major automaker and a large share in two more. In addition, Geely also owns LEVC, makes of the iconic London black cabs. The deal is also reportedly Daimler's largest foreign purchase by an individual to date.
With that, Li Shufu aims to be able to share and use technologies used in Daimler vehicles, from hardware to software. Geely is also seeking an alliance with Daimler for the further development of electric vehicles. In a statement by Li Shifu's representative, the chairman wants to "accompany Daimler on its way to becoming the world's leading electro-mobility provider", and was looking for a long-term commitment.
As it stands, Volvo, who is wholly-owned by Geely, is going all out for the all-electric push for future cars, which is aligned with the Chinese company's long-term plan. Volvo has yet to comment on the move the owner of their parent company made. At the same time, Daimler is aiming to further expand their presence in the Chinese market. China has been the biggest market for the brand, selling 587,868 vehicles in 2017 alone. All in all, it accounts for approximately 25 percent of Daimler's worldwide sales.
Speaking of expansion in China, just a few days ago, February 26, Daimler and BAIC announced plans to further expand production. BAIC has been a long time partner of Daimler, responsible for the Chinese production of Daimler vehicles in the country. Daimler invested $ 1.9 billion in the company for the expansion.
As a result of the deal, Geely Holding's stock went up dramatically. Initially, there were reports that it was Geely Holdings who would buy shares into Daimler. The Geely board has since clarified that by saying 'The Board confirms that it is not aware of any reasons for these price and volume movements or of any information'. They added, 'The company would like to confirm and clarify that it is not a party to the acquisition and it (Daimler) is not partnering with Geely Holding in relation to the acquisition'. However, the company says it, 'does not rule out the possibility of exploring potential co- operation opportunities with Geely Holding and Daimler AG in future.'