Posts tagged 'Volvo'

Trucked in a low growth world, Volvo edition

Good old self-help: saviour of earnings, wellspring of hope. After a while, however, it really would be useful if economic growth would lend a hand.

Case in point, Volvo, where the analysts at Deutsche Bank have decided that five sets of disappointing earnings is enough. On to the sell list it goes. Read more

Snap news

Breaking pre-market news on Friday,

- Vodafone reiterates guidance but sales performance in Europe disappoints — statementRead more

Block trade watch – frothy markets edition

One big share placing in a week might be considered unfortunate. But two?

Passed to us by a broker on Thursday morning: Read more

Renault to raise €3bn by cutting Volvo stake

Renault is selling most of its stake in Volvo, the Swedish truck group, in a long-expected disposal that will fetch the French carmaker about €3bn ($4.18bn) and allow it to meet its stated debt-reduction goal, the FT reports. The company said it was selling all of its Series “B” shares in the Swedish group in a private placement with institutional investors, representing 14.9 per cent of Volvo’s share capital but only 3.8 per cent of its voting rights. However, Renault will retain all of its “A” shares in Volvo, representing 6.8 per cent of the company’s capital and 17.5 per cent of its voting rights. It said it expected no change to Volvo’s board as the result of the sale.

Volvo’s new chief sets sights on BMW and Mercedes

Volvo’s new Chinese chairman wants to take the Swedish car brand upmarket and compete directly with BMW and Mercedes-Benz by building a large luxury saloon, the FT reports. Zhejiang Geely Holding Group on Monday closed its purchase of Volvo from Ford Motor for $1.5bn in the biggest overseas acquisition yet by a Chinese company of an overseas carmaker.

Snap news

Breaking pre-market news on Thursday,

- Volvo Q2 beats forecasts, sticks to growth outlook – statementRead more

Geely seals deal to buy Volvo from Ford

Ford Motor signed a $1.8bn deal to sell its Volvo brand to Geely on Sunday in a move seen as emblematic of the shift in the global car industry’s centre of gravity from the US and western Europe to China, the FT said. Zhejiang Geely Holding Group, the parent of the Chinese carmaker, will acquire 100 per cent of Volvo and its assets.

Ford closes in on sale of Volvo

Ford Motor is set to announce further progress in the next next few days on talks to sell its Swedish Volvo brand to China’s Zhejiang Geely Holding Group. While a final deal had yet to be settled, the two sides were close to agreement on some key aspects, said people close to the talks. Protection of intellectual property rights and the future of Volvo’s Swedish and Belgian plants were among remaining issues. Ford named Geely in October as its preferred bidder for Volvo.

Geely named Volvo bidder

Ford Motor on Wednesday named a consortium headed by Zhejiang Geely Holding Group Co as the preferred bidder for its Volvo Swedish brand, bringing the Chinese carmaking group a step closer to buying it. Ford gave no price for Geely’s bid, but people familiar with the matter said the privately held group offered just under $2bn for Volvo. The US and Chinese companies are also discussing a deal to see Geely take control from Ford of Volvo’s captive finance operations, worth $5bn-$6bn.

US consortium vies for Volvo

A US-led consortium is challenging Geely Automobile of China in the race to buy Volvo, the Swedish carmaker, from Ford. The Crown consortium is fronted by Michael Dingman, a former Ford director and turnround specialist, and Shamel Rushwin, a former executive at Ford and Chrysler. Financing has been fully secured from US buyout groups, but the consortium is also talking to Swedish investors about taking up to a one-third stake in the consortium.

China’s Geely leads Volvo bidding

Chinese auto maker Geely Holding Group has emerged as the leading contender to acquire Swedish automaker Volvo from Ford, reports the WSJ. Ford is currently analysing a recent Geely bid to acquire 100% of Volvo for approximately $2.5bn, said people familiar with the matter. The offer is higher than Ford or outsiders had expected for a brand that has lost more than $1bn in recent years. In the quarter to June 30, Volvo lost $231m.

Goldman invests $250m in Geely

A Goldman Sachs-managed private equity fund is investing about $250m in Geely Holding Group’s Hong Kong-listed arm to fund the Chinese automaker’s growth plans, reports the WSJ. Geely is set to announce the investment by Goldman Sachs Capital Partners on Monday. The move could free up capital for the bid by the parent of HK-listed Geely Automobile Holdings for Ford’s  Volvo unit.

Ford studying possible sale of Volvo

Ford Motor said Monday it was reviewing its strategic options for Volvo, “including the possible sale” of the lossmaking Swedish premium brand. The announcement preceded Ford’s submission of its future plans to the US Congress on Monday alongside GM and Chrysler as Detroit’s three car companies make their case for $25bn of emergency aid. Ford said the decision to study its options was in line with actions it was taking to strengthen its balance sheet and ensure it had enough money to implement a product-led transformation plan. Volvo reported a Q3 loss of $458m, and is in the process of laying off about 6,000 workers, or one-quarter of its staff. The US is its largest market, and its larger vehicles especially have suffered from the downturn in demand for cars. Volvo’s sales to end-October were down 28% on last year, including a 52% drop in October. The US parent said the review at Volvo would probably take several months.

Road safety

Volvo reports some pretty dreadful results today:

After a first and second quarter with record sales and record income, sales growth decelerated much more rapidly than expected during the third quarter, as visible in the reported earnings.  Read more

Deripaska eyes Land Rover, Jaguar

Billionaire tycoon Oleg Deripaska, the head of Russian automaker GAZ, is interested in Ford’s premium British brands Jaguar and Land Rover, reports Reuters, citing German business weekly WirtschaftsWoche. The magazine said Deripaska would also be a possible bidder for Volvo should Ford decide to sell the Swedish brand. Another firm owned by Deripaska, Basic Element, agreed in May to invest $1.54bn in Canadian auto parts supplier Magna.

Ford sell-offs move up a gear

Ford is likely to let prospective bidders begin due diligence on its Jaguar and Land Rover brands next month and is pleased with the expressions of interest it has received in the brands, and in the “strength and quality” of the interested parties, according to Alan Mulally, Ford chief executive. Mr Mulally told the FT that Ford was “open to different options,” including retaining a minority stake in both operation, and would rather sell the two brands jointly. His comments came as the carmaker reported a surprise second-quarter profit fuelled by cost reductions, improved vehicle pricing and the sale of its Aston Martin division. Mr Mulally also confirmed that Ford was “conducting a strategic review of Volvo”, which could be sold separately to the other luxury brands.

Ford weighs sale of Volvo

Ford Motor is considering the sale of its Swedish-based Volvo car division, a move that would mark the final dismemberment of its luxury car business outside North America. The struggling Detroit-based carmaker said on Sunday it was not presently in talks with any other company about a Volvo sale. It noted, however, that it was assessing its operations and “looking at strategic options”. Ford has already sold or is considering bids for the other three marques of its luxury car division, known as the Premier Automotive Group.

Ford denies Volvo sale

Ford Motor said it was not in discussions aimed at a sale of its Swedish unit Volvo, denying reports its was mulling an immediate disposition of a unit seen as its most valuable luxury brand, reports Reuters. Swedish newspaper Goteborgs Posten said on Monday that Ford was eyeing a sale of its Volvo brand and named German carmaker BMW Research as a possible buyer. That followed an FT report on Friday saying that BMW had been in informal talks to buy Volvo from the struggling No. 2 US automaker.

Small is beautiful in China’s burgeoning private equity market

The difficulties encountered by Carlyle, the US private equity group, in its struggle to acquire control of Xugong Construction Machinery, the Chinese state-owned construction machinery maker, should not deter private equity investors from shopping in China — the art is in buying small and “staying below the radar”, the FT says.

Amid mounting political pressure, Carlyle first reduced its intended investment from 85 per cent to a 50-50 joint venture. This week it scaled down its plans to a 45 per cent minority holding. But Volvo had no such trouble when it acquired a 70 per cent stake in Lingong Construction Machinery earlier this year, a company which makes similar products. Read more

Volvo pays $1.3bn for Ingersoll Rand unit

Volvo, the Swedish manufacturer of trucks, buses and construction equipment, on Tuesday continued its buying spree with the $1.3bn acquisition of the road construction business of Ingersoll Rand of the US. The purchase follows last week’s $1.1bn takeover bid for Nissan Diesel, the Japanese truck maker, and comes ahead of an expected investment in Dongfeng Motor, a Chinese truck group. Volvo is now within reach of replacing DaimlerChrysler as the world’s largest maker of heavy duty trucks and is among the top three in the global market for construction equipment, after Caterpillar of the US and Komatsu of Japan.

Nissan in $1.1bn deal for Nissan Diesel

Volvo launched a $1.1bn tender offer for Nissan Diesel on Tuesday to acquire the rest of the truck maker in which it owns a 19 per cent stake. The Swedish group is offering Y540 a share, or a 22 per cent premium to Nissan Diesel’s closing price of Y443 on Monday. Volvo last September upped its stake in Nissan Diesel from 13 per cent and bought Skr3.5bn worth of convertible shares that would raise its stake to 46.5 per cent by 2014. The swift move by Volvo to take control of Nissan Diesel comes as the Swedish group faces pressure from Cevian Capital, an activist investment fund, to redistribute surplus cash to shareholders.

CDS report: prices rise on LBO worries

Credit derivative prices of some of Europe’s leading companies were weaker on Friday as worries over takeovers and leveraged buy-outs prompted buying of protection in a relatively thin market, still sluggish following the Christmas and New Year holidays.

The cost of protection on the bonds of KPN, the Dutch telecoms operator, rose by 4 basis points, or €4,000 annually on every €10m of debt, with the spread trading at a mid-price of 70.5bp. The weakening of KPN’s five-year credit default swaps was down to growing speculation that the company could be a LBO target for private equity. Read more