China’s top economic planner has approved of Chery’s plan to buy the Volvo brand from Ford Motor, Gasgoo says. The report is not confirmed yet by Chery Auto. However, Gasgoo is very close to Chery.
According to Chinese media reports, The Dongfeng Motor has also submitted its Volvo-bidding plan to the National Development and Reform Commission (NDRC). The company’s spokesman denied the reports.
On Feb. 12, Chery Auto president and CEO Yin Tongyao said that his company would not rule out the possibility of buying a troubled European auto brand. Volvo was believed to be one of the choices.
Chery Auto received a 10 billion yuan ($1.47 billion) loan to fund its global growth from Export-Import Bank of China (China Eximbank) in December 2008. The company was also granted the flexibility of a credit line by the bank.
Ford put Volvo up for sale late last year to raise cash, but has found little interest in the brand, because many potential buyers are facing similar crisis and the nearly $6 billion needed for buying Volvo is a prohibitive price for most carmakers.
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