Volvo plans to keep some shares in Polestar but will no longer provide funding for the EV startup.
the electric vehicle startup as it focuses funding its own transformation into a fully electric brand.
The shares in Polestar will be distributed to Volvo's own shareholders, the biggest of which is Zhejiang Geely which owns 79.5% of the company. The move will give Geely more control of Polestar. Geely's chairman, Li Shufu, is also a major shareholder of Polestar with a 39% stake. At Polestar's current share price, the shares are valued at around $921 million. After the close of the deal, Volvo will still retain about 18% of Polestar.
In a statement, Volvo CEO Jim Rowan said it was “logical” to retain some influence in Polestar given the close collaboration between the two companies.Polestar, which was originally a Swedish racing team and then the performance arm of Volvo before becoming a standalone EV brand in 2017, currently shares technologies, production facilities, and other commercial operations with Volvo. Polestar also has a loan owed to Volvo., won't have to completely fend itself.
Polestar is also expected to grow its sales sharply in 2024 with the arrival of the Polestar 3 and Polestar 4 SUVs. Polestar last year delivered approximately 54,600 vehicles, mostly the Polestar 2 hatchback. That tally is 6% higher than 2022's deliveries.
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