China’s Geely surges after building $9 billion Daimler stake


HONG KONG (Reuters) – Geely Automobile Holdings Ltd’s (0175.HK) shares jumped on Monday after its chairman Li Shufu revealed he had built a $9 billion stake in Daimler (DAIGn.DE) – giving him major leverage as he attempts to persuade the German carmaker to cooperate on tech. The 9.7 percent holding makes Li Daimler’s biggest shareholder and puts the owner of Mercedes-Benz in a quandary as it already has a partnership with China’s BAIC Motor Corporation, with the two unveiling a plant investment of almost $2 billion on the weekend. Li is expected to meet Daimler executives in Stuttgart on Monday and hopes to meet top German officials in Berlin. Germany has said there is no need to take action on the stake owned by Li. Slideshow (2 Images)Geely’s stock surged 8 percent, buoyed by hopes of access to Daimler’s technology which would help it compete in a fast-shifting market being disrupted by electric cars and autonomous driving. Its parent Zhejiang Geely Holding said on Saturday there were no plans to raise the stake “for the time being”. Geely has been expanding rapidly. The parent firm owns Volvo Cars, LEVC, the maker of London’s black cabs, and last year took a majority stake in sports car maker Lotus, a 49.9 percent stake in Malaysian automaker Proton, a $3.3 billion stake in Volvo Trucks and control of flying car start-up Terrafugia. Among the 36 analysts that cover Geely, the average rating on the shares is “buy” with 27 recommending “strong buy” or “buy”. Reporting by Donny Kwok; Editing by Adam Jourdan and Edwina GibbsOur Standards:The Thomson Reuters Trust Principles.
Source: Reuters