Is Volvo About To Be Purchased By Chinese Auto Manufacturer Geeley?
Posted by Neil Payne on December 2nd, 2009Chinese carmaker Geely, picked as the preferred bidder for Ford Motor’s Volvo unit, is seeking at least $1 billion in loans from Chinese banks to back its $1.8 billion bid.
Three major Chinese banks planned to jointly extend loans to Zhejiang Geely Holding Group, including Bank of China, China Construction Bank and Export-Import Bank of China had.
Bank of China is China’s top foreign exchange lender. China Construction Bank is the country’s No 1 property lender. Export-Import Bank of China is a policy lender wholly-owned by the Chinese government and directly led by the State Council.
Will This Be The New Logo For Volvo?
“Money is not a problem for Geely,” said an unidentified source. “They definitely have strong support from Chinese banks and there are a number of private equity funds queuing up to invest in Geely.”
The three Chinese banks mentioned above refused to comment on specific loans to clients.
Hangzhou-headquartered Geely, which means “lucky” in Chinese, is in need of modern and innovative technologies, which may be met by the Swedish brand, to upgrade its car lineup and tap the auto market.
Last month, Volvo’s union leaders held their first talks with Geely but were still waiting to see Geely’s financing plans for the loss-making Swedish carmaker.
Geely reached an agreement last week with Ford on intellectual property right (IPR) issues in its bid for Volvo, clearing a major barrier for the deal.
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