STOCKHOLM/LONDON, Oct 4 (Businesshala) – Geely-owned Volvo Cars plans to raise 25 billion Swedish crowns ($2.9 billion) through an initial public offering (IPO), the Swedish carmaker said on Monday. In what will be one of Europe’s biggest listings. this year.
Volvo said it would list on the Nasdaq Stockholm stock exchange this year and that Chinese owner Geely Holding (GEELY.UL) would remain its largest shareholder.
In 2018 Volvo Cars & Geely, which owns an 8.2% stake in Sweden’s Volvo Trucks (VOLVb.ST), shelved plans to float shares in the Swedish carmaker, citing trade tensions and a slump in automotive stocks.
“Volvo Cars believes its unique structure and focused strategy make it one of the fastest transformers in the global automotive industry, with mid-decade ambitions dedicated to electrification, sustainability and digitization.” The Swedish company said in a statement.
Like many other car manufacturers, Volvo has committed to move its entire car range to fully electric models by 2030.
Volvo said it aims for an operating margin of between 8% and 10% by 2025. It is also targeting annual sales of 1.2 million cars, a 56% increase from 770,000 sold in the 12 months to June 20 this year.
The carmaker said it expects 50% of sales to be fully electric cars by the middle of the decade and 50% of sales will be done online rather than through dealerships.
Volvo Cars said earlier on Monday that its sales in September fell 30% from a year earlier, hit by global components shortages.
Sources told Businesshala last month that Geely was in advanced discussions with banks to list the Swedish company in the coming weeks, aiming for a valuation of about $20 billion.
Volvo Cars has previously said that it is considering a Stockholm listing in the second half of 2021.
A Volvo spokesperson said Monday that the company did not comment on valuation or how much business will be sold in the IPO.
“More information regarding the prospectus will be published,” she said.
Electric-car maker Polestar, which is owned by Geely and Volvo, said last week that it would go public by merging with US-listed Special Purpose Acquisition Company (SPAC), co-founded by billionaire Alec Gores and investment bank Guggenheim Partners. Backed at enterprise value. $20 billion.
($1 = 8.7236 Swedish Crown)