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Geely closes in on Volvo takeover

TT/The Local · 24 Mar 2010, 08:06

Published: 24 Mar 2010 08:06 GMT+01:00

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The only factor that could throw a spanner into the works is a battle over a loan from the European Investment Bank (EIB).

The newspaper cites three sources close to the deal. According to one of them, half of the purchase is financed by loans from European banks, of which around $500 million comes from Swedish banks. The remainder of the financing will come from China.

China's vice-president Xi Jinping is expected to pay a visit to Sweden on Saturday, and the contracts are expected to be undersigned either on Sunday or on Monday, according to one of the newspaper's sources.

The aforementioned EIB loan could be a potential problem, according to one of the sources, in the instance that a European competitor objects to the provision of loans to a state-supported firm.

"My understanding is that Geely is a state-supported company and in that sense it is the Chinese state which is buying Volvo," said Lars Holmqvist CEO of automotive parts supplier Clepa, to Dagens Industri (DI).

Story continues below…

Holmqvist questions if Geely has a right to state-guaranteed loans.

Hans Lindblad, state secretary at the finance department, also holds reservations. He told DI that it is not "a matter of course that a Chinese state-backed firm would be approved for this type of loan," referring to the four billion kronor ($556 million) in loans that the EIB has granted Volvo Cars.

TT/The Local (news@thelocal.se)

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Your comments about this article

11:02 March 24, 2010 by Eagle63
Glad I stuck with SAAB.....
12:54 March 24, 2010 by LailaC1
Glad I stuck with SAAB too - shall we just sell everything we have and give away all our jobs to the Chinese?!
16:46 March 24, 2010 by Volvo D
excuse me while i throw up...

Time to go back to SAAB if this stupid deal actually goes through. Ford, you suck, i am NEVER going to buy any product with your name on it.
17:07 March 24, 2010 by spy
Poor Volvo... They have been very quiet but the fact remains this is very bad for the brand.

Gothenburg residents should lock up their dogs or they will end up in the pot.
19:54 March 24, 2010 by ups
USA is very strong
21:22 March 24, 2010 by Bourker
I can't believe that the Swedish people aren't up in arms of the loss of an iconic Swedish brand, Volvo trucks should have reacquired their motor division.

As for Ford they don't give a monkey's about Volvo, one they have their hands on the $1.8bn Geely will be let do what it wants. That said Volvo are still a better long term bet than Saab, if the Chinese supply the money and keep their noses out it might just have a chance.
00:56 March 25, 2010 by stoffer
@Bourker - I couldn't agree more.
01:01 March 25, 2010 by blursd
@ Bourker ... I agree as well.
03:17 March 25, 2010 by Ghostrider
What a disaster. Ford and GM have done Sweden no favors.
10:34 March 25, 2010 by spy
These Geely guys are a bunch of savages. I really feel for Volvo. Hopefully an 11th hour saviour will come to save them.
12:42 March 25, 2010 by michahug
I don´t know what´s the problem. Up to now Volvo was American swedish, no it is getting Chinese swedish. Of course it would have been better if a German like Volkswagen or BMW would have purchased it. But they might have had their reasons not to do it. Volvo Trucks has too many own problems in the truck business, it simply would be crazy to re-buy Volvo Cars. There are not many synergies between the truck and the car business. The problem ist that Volvo Cars is too small.
12:43 March 25, 2010 by DaveZ
Hi guys, I think we miss something here. We should look at who will benefit the most. It will probably Goldman Sachs. Goldman bought a huge amount of shares from Ford when the price was low during the crisis, and urged Ford to sell Volvo. Then the share price roared. Goldman also bought many shares of Geely before the deal. Now Geely's share price is roaring. I think this deal is mainly manipulated by the powerful Goldman Sach. National pride, brand history, and workers' interests mean nothing to the evil investment band.
19:07 March 25, 2010 by livinginsweden
Lock your doors, the chinese are coming, keep your dogs indoor, the dog eaters are coming, keep your potatoes safe, the rice are coming, throw away your iphone, the chinese have spy ware encrypted in the chips, throw your sony ericcson phones away, the chips have been burned by the chinese spies, close down arlanda airport, the chinese are landing, stop shopping at Ica and coop, the chinese wok food are coming, ....

The yellow people are taking over the world before the aliens from outer space.....!!!!!!!!

ha ha ...
10:11 March 26, 2010 by Icarusty
The racism towards the Chinese is astounding. Were it for any other race people would be called up on it very quickly, seems everyone is just letting it go because it's the Chinese... people like spy making stereotypes and being disrespectful towards people he has never met... you'd think Swedes would be grateful any company would buy up third hand goods passed on from Ford - the Americans weren't exactly kind to your used up brand, were they?

Oh, FYI, Geely is the largest private owned car company in China... they wouldn't float it on the stock market if it was owned by the Chinese Govt... they may have a healthy percentage of stock in Geely, but no more so than the US does in Ford, GM etc. etc. after the bailout.
13:58 March 26, 2010 by steven wang
honishtly, Geely is private company in china, it only have support from the chinese bank, no politic background. After the sale, i can sure that all the sector of the volvo will keep in sweden, while it will expand the chinese market quickly. maybe after ten years, volvo maybe larger than volskvagen or ford. i hope every swede can look at this thing rationally. dont let it politics. i think after this, china and sweden coorporation can lead to a more deep future. volvo will be a sweden brand forever in everyone's heart, no matter who own it (even ford).
17:26 March 26, 2010 by Icarusty
The sad thing is, they're looking at it more on racial lines than politically. Whites don't like their companies being bought out by non-whites - it disrupts their sense of superiority.

That is the main reason behind the racial insults. Politics is just politics.
20:50 March 26, 2010 by MaxKista
f**k you all mother f**kers and cock s**kers.

I am chinese and we WILL take over your mother f**king country.

SO WHAT!!!!!!!!!!!!!!!!!!!!!!!!!
21:37 March 26, 2010 by spy
I am not racist but I do not agree with running over students in tanks or eating dogs.
23:22 March 26, 2010 by Icarusty
Who does? The fact that you stereotyped a billion people into those characteristics say much about you. Every day I hear reports about white men raping women, children... yet still I don't make the assumption that all white men are paedos.

A small minority of Chinese eat dogs, far smaller than the proportion of white paedos - the poor ones who can't afford any other sources of meat. As for theTank man incident - it was 20 years ago, let it go kraut.
09:01 March 27, 2010 by spy
Yeah the 'tank incident' was 20 years ago but what about: Tibet

Lack of freedom speech and media reporting or censorship of the internet

Supression of religious beliefs

Torture of prisoners and no judicial independence to ensure fair trials

Death penalty (and the fact that people can be put to death for nonviolent crimes such as theft)

09:46 March 27, 2010 by bjinger
Some of the above are crazy ideas with strange thinking. People believe that free trade and mutual benifits are the Chinese core valve in its pursue for a democratic and homonious world.
16:54 March 27, 2010 by babble4
As for me, I can't wait for the Chinese to take over Volvo and drive it into the ground. At least that way the pure wanks that drive these cars (outside Sweden) will finally get the comeuppance they deserve. This marque with its over-emphasis on safety attracts aggressive drivers, i.e. the aforementioned tank drivers or the road hogs. They either drive below limits or drive too fast. If you ever find yourself at a dealer's repair garage that happens to market several marques from all over the world including a Volvo, the garage will be filled with crashed Volvos. Need I say more?
18:25 March 27, 2010 by Icarusty

There you are, doing it again. 90% of yours (and many whites) issues are against Chinese Government policies - yet you blame the Chinese people. That's a clear definition of racism.

Tibet? At least it's not half way around the world like Iraq and Afghanistan.

Dogs? Killing and skinning reindeer I find far more evil.

The death penalty? The only superpower in the world uses it. And quite frankly, it it puts to death people who rape, murder etc. as opposed to a few years prison followed by "counselling" like in scandanavian countries, well death penalty wins out any day.

The fact is, everything you bitch about the Chinese has been done by whites, in a more severe form a thousand times over, past present and no doubt the future. Swedish arms exports on the rise once more... a bit of that viking mentality never dies, eh? Indeed, you guys endorse violence. I don't see why the Chinese have to restrain themselves just so they can suck it up to whites.

Now go to bed you paedo.
12:48 March 28, 2010 by DaveZ
Business is business. Avery country has their own issues; however, these have hardly anything to do with this deal. Don't start a racial war here. I think we, Europeans, have suffered enough from that. The deal would be win-win for every stakeholder. As a socialist, I think the only parameter to evaluate how successful will the merge be is that how many workers can keep their jobs.
04:40 March 29, 2010 by anticommie
LOL guessing soon the jobs will be moving to china, who will support your welfare scumbags? Saab will be out of business soon and ericsson is on the downslide with no products worth a crap. You can become a country of beggers! LMFAO
18:24 March 29, 2010 by spy

I welcome your criticism of me and your point of view even if I don't beleive in it - but if you levelled criticism of China in this way you would probably disappear in the same way as thousands of other protestors. Enjoy the freedom in the civilised world - you are privileged by comparison.
05:45 March 30, 2010 by Icarusty
And there it is again! Conveniently ignoring and properly responding to my post and instead using the condescending "you're lucky you're here in the West". Might as well say "know your place boy".

All countries have plenty of bad things going on for everyone to latch onto. The main difference is, you, and more specifically white citizens, make it racial. When you guys go on the offence, it is not an attack on another country's policies - no, it is an attack on their race, their culture.

When I critique the Americans, I never mention the fact that they do what they do because they are white. The fact is, whenever something Chinese related (like this story) comes on the closet racists come up with their snide remarks regarding eating dogs and the reds taking over. There was no productive argument in your initial comments, only casual racism.

And unfortunately I cannot enjoy the freedoms of the "civilised" world, because it is in these white, "civilised" countries who have the most/largest proportion of racist extremists/supremacists in the world. Indeed, I find it amazingly hypocritical that you would call yourselves civilised when there are groups of your race setting up chapters all over the "white world", hellbent on the elimination of people simply for their skin colour. Would you really call racial hatred an act of a mature civilisation?

And remember you are also privileged in comparison and should be happy with that also. Just because one is of a certain race but born in a country that allows freedom of speech, does not make him more lucky than a white born in the same country.
21:25 March 30, 2010 by spy
Skin colour has nothing to do with how civilised a country is. Civilisation is based on actions - as has been proved countless times before, China is a savage nation. Unless you have a good excuse for the points below....

- China's treatment of Tibet

- Lack of freedom speech and media reporting or censorship of the internet

- Supression of religious beliefs

- Torture of prisoners and no judicial independence to ensure fair trials

- Death penalty (and the fact that people can be put to death for nonviolent crimes such as theft)

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