May 10, 2018
Volvo Cars owner Zhejiang Geely Holding Group Co. has selected Citigroup Inc., Goldman Sachs Group Inc. and Morgan Stanley to advise on an initial public offering for the Swedish carmaker this year, according to people with knowledge of the matter.
China’s Zhejiang Geely and Volvo have discussed valuing the Swedish automaker in a range of $16 billion to $30 billion in a stock sale, the people said, asking not to be named as the deliberations are confidential. The companies held meetings in Sweden and Hong Kong this month to discuss a dual listing in both venues, they said.
The shares could be sold as early as this fall, though no final decisions have been made and the plans may change, they said. An IPO is an option but the decision is up to the owner, a representative for Volvo Cars said, declining to comment further. Representatives for Geely, Citigroup and Morgan Stanley declined to comment. A spokesman for Goldman Sachs didn’t immediately comment.
Volvo Cars may seek to benchmark itself against automakers including Hong Kong-listed Geely Automobiles Holdings Ltd. and Tesla Inc. in the potential IPO, the people said.
Closely held Zhejiang Geely, which is backed by billionaire Li Shufu, acquired Volvo in 2010. The Chinese company’s Swedish unit holds 99 percent of Volvo Car AB, while a group of Swedish institutional investors holds the remaining 1 percent through another class of shares, according to its website.
The Gothenburg-based automaker posted a 1.8 percent decline in first-quarter profit. The U.S. was the main driver for its sales growth, while China continued to be its biggest market, closely followed by Sweden and the U.S.
Bloomberg