Chinese carmakers have set their eye on acquiring global carmakers reeling from the global financial crisis. Hong Kong's South China Morning Post on Wednesday reported that China's largest private automaker Geely's bid to acquire Ford's Volvo unit is in the last stage.
Ford bought Volvo for US$6.45 billion in 1999. But it has recently put the car unit on the market for $1.8 billion, far less than one-third of the price it had paid.
Out of the $1.8 billion purchase price, Geely has lined up $1 billion loans from three major government banks -- Bank of China, Construction Bank of China and Exim Bank of China -- to finance its bid for Volvo, the daily said.
An industry source said, "Geely is fully supported by Chinese banks, and even private equity firms line up to support its bid. Its negotiation is proceeding fast."
Meanwhile, the Wall Street Journal on Wednesday reported Beijing Automotive Industry Holding (BAIC) is moving fast in its bid to acquire GM's Swedish unit Saab.
BAIC with a support fund from the Chinese government jumped into the bid belatedly last week when Koenigsegg, a Swedish sports carmaker, gave up its bid to buy Saab. BAIC president Wang Dazong said, "We'll move into the world by using Saab as a lever."