Mumbai, 20th December 2016 - Volvo Cars, the premium car maker, has raised SEK5bn from the sale of newly-issued preference shares to a group of Swedish institutional investors.The group of investors comprises two Swedish pension funds, AMF and the First Swedish National Pension Fund (AP1), as well as Folksam, a Swedish insurance company.
The preference shares may be repurchased or converted into listed ordinary shares upon the majority shareholder’s decision. At this time, no decision has been taken.
The issuance has been conducted to further diversify Volvo Cars' long term funding sources.
The detailed terms of the sale have not been disclosed, but the transaction will have an immaterial dilutive effect on the current 100 per cent ownership of Volvo Cars by Zhejiang Geely Holdings.
The share sale follows two bond issues earlier this year, a EUR500m bond to global institutional investors in May, and a further SEK3bn to Swedish institutional investors in November. The bonds were issued for general corporate purposes and aimed at increasing the company's financial flexibility.
Today’s move is another step towards Volvo Cars’ long expressed ambition to act as a listed company.
Volvo Cars’ financial performance is strong. It is expected that 2016 will be another record year in terms of sales, with growth coming across the board from its three main sales regions of Europe, China and the US.
Operating profit for the first nine months of the year was SEK7.7bn compared to a full year operating profit for the whole of 2015 of SEK6.6bn, prompting Volvo Cars' expectations for the full year to "substantially improve" profits compared to last year.
Volvo Cars has successfully built a sense of momentum around its transformation since it was acquired by Zhejiang Geely Holdings in 2010, driven by the ongoing renewal of its complete product range, powertrain and chassis technologies and safety and connectivity technologies.
In coming years Volvo Cars will continue to reposition its brand to compete with its global premium rivals, revive its operations in the US and develop its global manufacturing footprint, grow further in China and double its market share in Europe.
It will also introduce an entirely new model range, embed its new engine technologies and maintain its position as the leader in car safety and autonomous drive (AD) technologies.
Volvo Cars is also forging alliances that place it at the forefront of the latest technological developments in the automotive industry developments.
It intends to set up a joint venture with Autoliv, the leading automotive safety technology company, to design and manufacture separately-branded AD and driver assistance software technology packages for sale to third party OEMs.
Volvo Cars has also joined forces with Uber, the ride sharing company, to build and co-develop base vehicles for AD cars.
This announcement contains inside information within the meaning of Regulation (EU) No 596/2014 of 16 April 2014 on market abuse.
Volvo Auto India
Swedish luxury car company Volvo Auto India (VAI) established its presence in India in 2007 and has since then, worked intensively to market the Swedish brand in this country. Volvo Cars currently markets products through its dealerships in South Delhi, West Delhi, Gurgaon, Ahmedabad, Surat, Mumbai, Chandigarh, Coimbatore, Hyderabad, Chennai, Bangalore, Kochi, Vishakhapatnam, Kolkata and Vijayawada. Expanding soon to Lucknow, Pune and Jaipur.
The company sells eight luxury models.
Volvo S60 – A sporty sedan
Volvo S60 Cross Country – All road. All weather sedan
Volvo V40 – Luxury hatchback
Volvo V40 Cross Country – The adventurous cross country
Volvo XC60 – A technologically advanced luxury SUV, apt for Indian roads
Volvo XC90 – The most awarded 7-Seater Luxury SUV
Volvo XC90 Excellence- India’s first plug-in hybrid SUV
Volvo S90- The premium luxury seda
Volvo’s Brand Philosophy
‘Designed Around You’ is the brands translation of going an extra mile to understand customers better. This human-centric approach enables Volvo Cars to know the pulse of the customers and gauge what they desire in a product. With this thought, the brand places the customer at the heart of its design. Every Volvo car boasts of cutting-edge technology with engineering that is executed around human values.
For more on Volvo Cars, please visit - www.volvocars.in