Zhejiang Geely Holding Group from China is selling all of its Class B shares in Volvo AB, a truckmaker. These shares are valued at 14.46 billion Swedish krona, which is about $1.32 billion in US dollars. Geely says this move is part of its long-term strategy. Even after selling these shares, Geely will still be Volvo’s second-largest investor, owning 88.5 million A shares.
According to Geely, adjusting its strategy and including AB Volvo in its automotive manufacturing and investment plans is a way to manage risks and diversify its investments. The company is selling 49.5 million shares through BofA Securities, Goldman Sachs Bank Europe, and Barclays. The price per share is set at SEK285.9, which is a bit lower than the closing price.
Volvo recently announced its first-quarter operating profit, which was better than what analysts had expected. Despite facing a decrease in orders, Volvo managed to make more money by raising prices. The company has been making fewer trucks as demand goes back to normal levels after the pandemic. Its shares have gone up by 12% this year.
Geely has been reducing its ownership in Volvo since January. They also sold some of their shares in Volvo Car AB last November. Earlier this year, Geely had to help Polestar, an electric car company that it co-owns with Volvo Car because it was facing financial difficulties.
