China's Geely Automobile Co has made an official bid to buy Ford Motor's premier car unit Volvo, according to media reports yesterday.
Among interested buyers, Hangzhou, Zhejiang Province-based Geely is the only auto maker that has submitted a concrete offer for the money-losing car maker, Swedish business daily Dagens Industri reported.
Privately-owned Geely was keen to buy Volvo after Ford in December said it would sell the Swedish subsidiary. The United States car maker has been spinning off unprofitable brands to cut costs and raise funds.
"Geely has been studying Volvo's information since June, particular focusing on the brand value," an industry source said. "It also negotiated with investment banks in the first half of this year to arrange capital for the purchase."
Earlier media reports said Geely plans to spend US$2 billion to buy Volvo. The price is lower than the US$6.49 billion Ford invested when it acquired Volvo.
Geely also got approval from the Chinese government to go ahead with the acquisition.
Ye Sheng, an auto analyst with automotive marketing consulting firm B Thinking Management, said buying Volvo during an economic slowdown would be a rare opportunity for Geely to lift its brand image worldwide.
Ford is expected to decide on the buyers for further negotiations as early as this month and the deal is reportedly to be finalized by the end of the year, according to the newspaper.
A Geely spokesman declined to comment yesterday.
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