Having announced last week that its specialist electric brand Polestar would be going public on the stock exchange, it was confirmed overnight that Volvo would also be going public.
In statements issued overnight, Volvo confirmed it would be going public on the Nasdaq Stokholm stock exchange via an initial public offering (IPO). The IPO is tipped to raise approximately US$3.9billion in funds for the company.
A report by the Wall Street Journal indicates that some investors are likely to value the company at over US$25billion. That’s well short of Tesla’s gargantuan current US$767billion valuation, but Volvo has to start somewhere.
The news comes as Volvo ramps up its roll-out of electric vehicles around the world. It launched its XC40 Recharge plug-in hybrid locally last year, and last week Polestar revealed aggressive pricing for the upcoming Polestar 2 in both Australia and New Zealand … almost equalling the Tesla Model 3.
“The decision to proceed with an IPO will help strengthen our brand and accelerate our transformation strategy – towards full electrification, direct consumer relationships and the next level of safety,” said Volvo CEO Hakan Samuelsson.
“This will position the company to deliver continuous growing volumes, revenues and profitability.”
“Over the past decade, Volvo Cars has turned itself into one of the world’s fastest-growing carmakers. We will continue to support Volvo Cars as a majority shareholder in this ongoing global success story,” added Geely founder Eric Li.
Geely is set to be Volvo’s majority shareholder, although it hasn’t been reported exactly how many the Chinese firm owns. The remainder of the shares are divided into two offerings; one for investors from Sweden, Norway, Finland, and Denmark, and the other for investors from the rest of the world.