Ford to Sell Volvo to China's Geely - TheStreet

Ford to Sell Volvo to China's Geely

Ford confirmed Wednesday terms have been met for the sale of its Volvo unit to China's Geely.
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Updated from 12:21 a.m. EST

DEARBORN, Mich. (

TheStreet

) --

Ford

(F) - Get Report

confirmed Wednesday that all "substantive commercial terms" for the sale of

Volvo

to China's

Zhejiang Geely Holding Group

have been settled.

Ford and Geely anticipate a definitive sale agreement to be signed in the first quarter of 2010, with the closing of the sale likely to occur in the second quarter.

"The prospective sale would ensure Volvo has the resources, including the capital investment, necessary to further strengthen the business and build its global franchise, while enabling Ford to continue to focus on and implement its core ONE Ford strategy," Ford said, in a statement.

Ford said it doesn't intend to retain a stake in Volvo once the sale is completed.

Ford said it would provide further details once the deal is signed.

Geely was tapped by Ford as the "preferred bidder" for Volvo in late October.

Reports have Geely offering about $2 billion for Volvo, less than one-third what Ford paid for the Swedish automaker a decade ago,

Bloomberg

reports.

Geely, one of China's biggest auto makers, is financing the bid for Volvo with a combination of cash, bank loans and funds from a small number of investors, a person familiar with the situation told the

Wall Street Journal

.

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-- Written by Joseph Woelfel in New York.

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