Geely says 'fully prepared' for Volvo buy

Geely Automobile, one of the country's largest private carmakers, said Thursday it was "fully prepared" for a bid to buy premium Swedish brand Volvo from US auto giant Ford Motor.

Ford said Wednesday it had tapped Zhejiang Geely Holding Group as the preferred bidder for its Volvo Cars nameplate and would step up negotiations with a consortium led by the Chinese automaker.

"We are fully prepared... to try to make (the bid) a success," said Geely spokesman Yuan Xiaolin.

The Hangzhou-based company had "a complete financing plan" for the bidding, added Yuan.

"We made the big decision to take part in the bidding after careful consideration and assessment. We think it is in line with the long-term development strategy of Geely," he said, without elaborating.

When asked how long the talks could last, Yuan said it was too soon to speculate about a timeframe. Ford emphasized that "no final decisions had been made."

The Geely spokesman also declined to comment on the financial terms of a possible deal.

Geely's shares soared as much as 4.5 percent in early trading in Hong Kong Thursday on the news but later fell back to HK$ 2.88 ($0.37), up only 0.3 percent.

In a statement issued Wednesday, Geely said under its bid, supported by Chinese banks, Volvo's existing production and research and development facilities, union agreements and dealer networks would be maintained.

Ford announced last December that it wanted to sell the loss-making Volvo unit, which it fully acquired in a $6.4-billion deal in 1999.

The group did not take government aid to cope with falling sales and avoided bankruptcy this year, unlike US rivals General Motors and Chrysler.

It has shed tens of thousands of jobs and closed plants in an effort to cut costs.

AFP

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