Volvo Car AB is looking to raise 25 billion kronor ($2.9 billion) in a Stockholm initial public offering in a test for automakers amid the sector’s transition to…
The Swedish carmaker, owned by China’s Zhejiang Geely Holding Group Co., is offering shares at 53 kronor to 68 kronor each, according to a statement Monday.
The deal values Volvo Cars at as much as $23 billion, 11 years after the Chinese firm bought the business from Ford Motor Co. for $1.8 billion. The IPO is set to be Europe’s largest since January, according to data compiled by Bloomberg.
The carmaker, with an ambitious plan to only sell full electric cars by 2030, plans to use the funds to add carmaking capacity so it can nearly double annual sales to more than 1.2 million vehicles. Volvo Cars also plans to construct a battery plant in Europe.
“We have a very clear strategy to be an electric company in 2030 and we’ve been on that journey for some years now,” Volvo Cars CEO Hakan Samuelsson said in an interview. “With this, of course, we can secure that transformation, because of course, it’s not free of charge.”
Volvo’s projected market capitalization of about $20 billion compares to roughly $65 billion for BMW AG, while the German premium carmaker produces more than 2 million vehicles versus Volvo Cars’ 660,000 last year. Newer entrants to the industry such as China’s Nio Inc. and Tesla Inc. have seen their share prices surge past traditional manufacturers even as they sell only a fraction of the number of vehicles.
The IPO also comes less than a month after electric-vehicle maker Polestar, controlled by Volvo Cars and Geely, said it will go public in New York via a…
Continue reading at YAHOO! FINANCE