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Volvo Could possibly be Valued at $25 Billion
The Swedish car maker Volvo Vehicles is aiming to lift $2.86 billion in an preliminary public providing in Stockholm. The car maker, which is owned by Geely (GELYF), could possibly be valued at $25 billion within the transaction.
Along with Volvo promoting an unspecified quantity of shares equal to $2.86 billion, Geely may additionally unload a few of its stake. It’s not clear what share of Volvo Vehicles Geely will personal as soon as the IPO is full, however the Chinese language firm has stated beforehand it desires to be a serious shareholder within the public firm. Volvo plans to make use of the cash from the IPO to shift manufacturing to electrical automobiles, increase its provide of batteries, and improve its manufacturing of electrical motors.
Volvo’s IPO Has Been within the Making for a Decade
It has been an extended journey to Volvo’s impending IPO. Ford (F) offered Volvo to Geely in 2010 for $1.8 billion. Over the subsequent decade Geely poured cash into the enterprise so it may revamp the model’s lineup and develop enterprise in China. All of these efforts have paid off: Volvo is now worthwhile and is forward of lots of its rivals within the EV race.
Volvo has additionally gained recognition within the US. Stateside, it competes with different premium manufacturers akin to BMW (BMWYY), Audi (AUDVF), and Mercedes-Benz (DMLRY). For the primary 9 months of 2021, Volvo offered 530,649 automobiles—an 18% year-over-year improve. The carmaker is aiming to promote a couple of million automobiles per 12 months within the coming years.
The EV Race Heats Up
If Volvo is ready to garner a $25 billion valuation, it will surpass Europe’s largest car maker, Renault (RNLSY), which has a market capitalization of over $10 billion.
At $25 billion, Volvo will nonetheless be tiny in comparison with the biggest car makers together with GM and Ford, in addition to the main EV maker Tesla (TSLA). Nonetheless, Volvo does present a means for buyers to wager on the EV market exterior of the largest gamers.
The EV market is heating up and car makers are pouring billions of {dollars} into their EV efforts. Volvo could also be comparatively small, however with a possible warchest of $2.86 billion, it will likely be fascinating to see what the car maker does as soon as it goes public.
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