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![Not allowed!](images/buttons/up_dis.png)
Hope this doesnt go badly for the Force
China's Geely Automobile says it is raising $US334 million from Goldman Sachs as its parent company mulls a potential bid to buy Volvo from US car giant Ford.
China's Geely Automobile said on Wednesday it was raising $US334 million ($A382.37 million) from Goldman Sachs as its parent company mulls a potential bid to buy Volvo from ailing US car giant Ford.
Geely Automobile said it was selling bonds and warrants worth a total of 2.59 billion Hong Kong dollars ($A382.37 million) to GS Capital Partners VI Fund, a private equity fund controlled by the US investment bank.
The Goldman Sachs fund would end up with a 15.1 per cent stake in Hong Kong-listed Geely if it fully converts the bonds and warrants into stock, the privately owned Chinese carmaker said in a statement.
Under Chinese government regulation, a foreign partner's stake in an auto joint venture must not exceed 50 per cent.
Geely said it plans to use the money to "fund the capital expenditures of the group, potential acquisitions by the group and for general corporate purposes of the group".
Its shares opened 26 per cent higher on Wednesday at 2.25 Hong Kong dollars, after being suspended since September 16 pending the announcement.
Parent company Geely Holding Group said two weeks ago that it may bid for Ford's loss-making Volvo unit in partnership with an unspecified state-owned investment company.
Chinese carmakers are on the hunt for foreign deals as competition intensifies on their fast-growing home turf.
State-run Beijing Automotive Industry Holding Co. Ltd (BAIC) is teaming up with Swedish sports car maker Koenigsegg to buy Saab from troubled General Motors, Koenigsegg said on September 9.
Little-known Sichuan Tengzhong Heavy Industrial Machinery signed a tentative agreement with GM in June to buy the Hummer nameplate.
BAIC was involved in talks to buy GM's Opel unit, but the US giant said this month that it was selling the German-based division to Canadian auto parts maker Magna and Russia's Sberbank.
Geely's sale to Goldman included 1.9 billion Hong Kong dollars worth of bonds and 299.5 million warrants. It will raise further funds once Goldman pays to convert those securities into shares.
The bonds can be converted into shares at 1.90 Hong Kong dollars, representing a premium of about 6.1 per cent to Geely's last stock closing price of 1.79, the company said.
There is a 28.5 per cent premium to the closing price on the warrants, which can be converted for 2.30 Hong Kong dollars each.
"12 Years aSupporter" starring the #SeaOfBlue
a canhardly driving a Volvo-the mind boggles
Seem to recall recently reading that Geely build Roller copies for a quarter of the price?
"Bloody oath we did!"
Nathan Sharpe, Legend.