Volvo Cars has revealed that it will be selling its 30 per cent stake in fellow Geely Holding Group subsidiary Lynk & Co for around USD 745.53 million or RMB 5.4 billion (about Rs 6,296.26 crore). The company says that 70 per cent of the consideration will be paid at the time of closing the transaction with the balance including interest to be paid after a year. The transaction is set to close in the first quarter of 2025 subject to the approval of shareholders and other regulatory approvals.
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Lynk & Co will see a change in ownership structure with fellow Geely subsidiary Zeekr to acquire a majority stake.
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Volvo has owned a 30 per cent stake in Chinese firm Lynk & Co since the brand was founded in 2017 with Geely Holdings and Zeekr holding 50 per cent and 20 per cent respectively. The disinvestment is set to see a new ownership for the company with Zeekr set to take over majority ownership of the brand with a 51 per cent stake. The remainder 49 per cent will continue to be held by Volvo’s parent firm Geely.
In a related move, Geely will also be increasing its stake in Zeekr to 62.8 per cent.
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Volvo says that despite the stake sale it will continue to ‘focus on operational collaborations with Lynk & Co in selected markets where there is a strategic benefit for both companies.’
