Geely won't name backer in bid to buy Ford's Volvo

China's Zhejiang Geely Holding Group wouldn't say where it's getting financial backing for a bid to buy Volvo Cars from Ford Motor Co., unions said Thursday.

Geely Chairman Li Shufu, the billionaire founder of Geely Automobile Holdings Ltd., China's biggest private automaker, gave assurances that Volvo's main plants in Sweden and Belgium will stay open, Glenn Magnusson of the Ledarna union said.

The four unions involved will hire a consultant to review the takeover plan's viability and "dig" into the financing question, Magnusson said in a phone interview. While Geely says its backers include Chinese banks, labor leaders are concerned that the government may ultimately be behind the takeover.

"It was a sensitive question for the Chinese," Magnusson said. "The answer we got was that Geely Holding is the main investor in buying Volvo. They didn't answer more than that. We may not find out until the final phase of the negotiations."

Li affirmed that there is no plan to meld the Volvo and Geely brands and that the Swedish company's base will remain in Gothenburg, Magnusson added. The official said yesterday that "things may be rosy" while the Chinese government views Geely favorably but that Volvo may lose out if that attitude changes.

The IF Metall union's Mikael Saellstroem said Li "was clear Volvo will have substantial growth" under the Geely plan and will seek to recoup lost market share in the U.S. The two main European plants may even add capacity and production at a factory in China will increase to serve the local market.

Magnus Sundemo, head of Volvo's engineering union and also at the talks, said yesterday that knowing who is backing Geely is "crucial in order to understand if they're long- term players and have the financial muscle to handle this."