China's Geely buys 7.3b euro Daimler stake in global push

Posted February 25, 2018

Chinese auto company Geely has continued to expand its global automotive holdings by acquiring a 9.69-percent stake in Daimler AG for 9.2 billion USA dollars.

Li, who chairs auto giant Geely Automobile Holdings, bought a 9.69% stake in the carmaker, worth around 7.2 billion euros (RM34.8 billion), according to the filing.

Geely considers that there is potential in Daimler due to the fact it its developing internet connections that use high speed for autonomous cars during at a time Li says that the satellite beam may one day become more important overall for the auto industry.

Geely on Saturday announced that it did not have any plans for now to increase its stake any further.

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Geely, which owns Sweden's Volvo Cars, continues to expand its portfolio of vehicle brands that includes a 49.9 percent stake in Malaysia's Proton and a 51 percent stake in Britain's Lotus.

China's avid search for footholds in Europe has raised hackles among some politicians in Berlin, Paris and Brussels.

Geely bought the struggling Volvo VOLVB -1.31% auto brand in 2010 and invested more than $3 billion in a stake in Volvo AB, the separate truck maker, late previous year.

Daimler has said that it aims to make all Mercedes-Benz cars electric by the year 2022.

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It's no secret that Geely was looking to strike an alliance with Daimler the past few months over EV technologies, as the Chinese government's requirements for cleaner cars create pressure on automakers.

Daimler overtook homegrown rival BMW to become the world's largest luxury vehicle maker by unit sales in 2016, helped by a broad refresh of its model range and powerful sales growth in China. Volkswagen AG is owned by the Porsche-Piech billionaire clan with the government of Qatar counting as a major stakeholder, and BMW is owned by the wealthy billionaire Quandt-Klatten family.

Daimler is making Mercedes-Benz cars for the Chinese market locally via a joint venture with partner BAIC motors.

BMW on Friday said it was in advanced talks with Great Wall to build an all-electric Mini model in the country, while Ford is planning to launch a series of electric vehicles in the market under a new brand in partnership with local carmaker Zotye.

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