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Volvo, the Swedish luxury car maker owned by Chinese Geely, has announced plans to conduct an IPO as it seeks to raise more cash to accelerate its transition to a fully electric car maker.
The announcement follows last week’s announcement that Polestar, the electric car company that is a joint venture between Volvo and Geely, would go public by merging with a Special Purpose Acquisition Company, or SPAC. The deal values Polestar at around $ 20 billion, despite selling only two models – a hybrid luxury coupe and an all-electric fastback sedan. Volvo is taking a more traditional route, with an IPO in Stockholm that could value the company at more than $ 25 billion.
Volvo has announced plans to raise around 25 billion crowns, or $ 2.86 billion, by issuing new shares. The aim is to use this money to accelerate plans to phase out the sale of gasoline cars with the aim of becoming a company exclusively dedicated to electric vehicles by 2030. This also represents a spectacular return for Volvo, which was sold to Geely by a besieged Ford for just $ 1.8 billion in 2010.
Volvo launched its first fully electric car, the XC40 Recharge, last year. The SUV has a range of around 200 miles and can charge its batteries to 80% of their capacity in 40 minutes. In our time with the car, we found it to be an “impressive blend of Swedish ingenuity, crossover utility and electric performance. The follow-up, the C40 Recharge, will be available later this year, while an XC90 electric SUV will not be revealed until 2022.
Listing would offer investors a chance to bet on the auto industry’s transition to fully electric vehicles at a time when tailpipe emissions are a growing concern and governments around the world are cracking down on car production. gasoline.
Geely, which is the largest private automaker in China, will sell some of its shares in Volvo as part of the IPO, although it has not specified how much or how this could affect the overall stake in the company. ‘business in the car manufacturer. Earlier this year, the company canceled plans to fully merge Volvo with Geely’s automotive division.
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