Volvo Cars and Geely Automobile are planning to merge

Volvo Cars and Geely Automobile are planning to merge in a move that would bring the Swedish company back to public markets and create China’s first global carmaker. The proposal, announced yesterday, comes 18 months after Volvo Cars abandoned an attempt to list independently, against a backdrop of growing consolidation in the car industry. Li Shufu, chairman of both Geely and Volvo Cars, has spent more than a decade assembling a portfolio of brands outside China to complement his domestic car manufacturing business. They include Britain’s Lotus and black taxi maker LEVC as well as Malaysia’s Proton. Geely called off talks to invest in luxury carmaker Aston Martin only weeks ago. Since acquiring Volvo Cars from Ford in 2010, Mr Li has mainly adopted an arms-length approach. But after investing $8 billion in reviving the Swedish brand via a complete model renewal, Mr Li has sought more integration between Volvo Cars and his Chinese brand through common components and technology needed for autonomous driving and electrification… The combined company would be listed in Hong Kong and could seek a secondary listing in Stockholm, Volvo said. Geely is already listed in Hong Kong.

Richard Milne and Peter Campbell