- Volvo Cars shares fell as much as 14% on Friday, hitting a record low.
- Volvo parent company Zhejiang Geely Holding Group has started selling around 100 million shares in the Swedish carmaker.
Volvo vehicles seen outside an Edmonton Volvo dealership on October 26, 2023 in Edmonton, Alberta, Canada.
Arthur Widak | Photo only | Getty Images
Shares of Volvo Cars plunged as much as 14% on Friday morning after parent company Zhejiang Geely Holding Group began selling around 100 million shares of the Swedish automaker.
At 9 a.m. London time, Volvo shares fell 10.31% after paring some losses. Shares had fallen as much as 14% earlier in the day, hitting a record low, according to Portal data.
Volvo shares have fallen 25% since the start of the year.
Geely said in a statement earlier Friday that it would release additional shares in Volvo, in line with its long-term strategy.
It said the move was designed to increase Volvo’s liquidity and “provide greater opportunities to create sustainable long-term value for institutional and retail investors.”
Geely will continue to hold 78.7% of Volvo shares after the sale, the statement said. Geely previously owned around 82% of Volvo, putting the shares sold at over 3%.
The holdings were sold at a significant discount and the sale amounted to around $350 million, according to Portal.
“As a majority shareholder, we remain committed to our commitment to further support Volvo Cars in its transformation into a pure electric car manufacturer, and we look forward to continuing this ongoing global success story,” said Daniel Donghui Li, CEO of Geely Holding Group the statement published on Friday.
Geely did not immediately respond to a CNBC request for comment. A spokesperson for Volvo Cars referred CNBC to Geely for comment.
Geely, founded by Chinese business mogul Li Shufu, who is still chairman, acquired Volvo Cars in 2010. The company’s portfolio includes a number of global car brands such as electric car giants Polestar and Smart, as well as Volvo.