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By Alex Ho
Investing.com – Hong Kong-listed Geely Automobile Holdings Ltd (HK:) is in talks with Volvo Cars to plan a merger and listing, according to a proposal announced on late Monday.
The two companies are in preliminary discussions regarding “a possible restructuring through a combination of the businesses of the two companies into a strong global group,” Geely said in the statement.
Volvo was seeking a valuation of up to $30 billion during its IPO preparation two years ago, but abandoned the plan against a backdrop of growing consolidation in the car industry.
Li Shufu, chairman of both Geely and Volvo, said on Monday that any deal would “accelerate financial and technological synergies” between the companies.
“A combination of the two companies would result in a strong global group,” said Li.
The combined company would be listed in Hong Kong and could seek a secondary listing in Stockholm, Volvo said.
Geely’s shares in Hong Kong jumped 6.1% to HK$14.54 in morning trade on Tuesday.
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