Jike will acquire 51% of Lynk&Co's shares through acquisition and capital increase.
On November 14th, Geely Holding announced the optimization of the equity structure of Jike and Lynk&Co, streamlining equity relationships, reducing related party transactions, eliminating inter industry competition, and steadfastly promoting deep and efficient integration of internal resources.
Geely announced that Geely Holding will transfer its 11.3% stake in Jike Intelligent Technology (hereinafter referred to as "Jike", NYSE: ZK) to Geely Automobile Holdings Limited (hereinafter referred to as "Geely Automobile", 0175. HK). After the transaction is completed, Geely Automobile's shareholding in Jike will increase to approximately 62.8%.
The integration of Jike and Lynk&Co is receiving more market attention. Geely Holding announced the optimization of the equity structure of Lynk&Co (hereinafter referred to as "Lynk&Co") to promote comprehensive strategic synergy between Jike and Lynk&Co. After integration, Jike will hold 51% of Lynk&Co's shares, while the remaining 49% of Lynk&Co's shares will continue to be held by a wholly-owned subsidiary of Geely Automobile.
Specifically, Jike will acquire a total of 50% equity in Lynk&Co by purchasing shares held by Geely Holding and Volvo, and will also acquire an additional 1% equity by increasing capital to Lynk&Co.
In the original equity structure of Lynk&Co, Geely Automobile, Volvo Cars, and Geely Holding held 50%, 30%, and 20% of the shares respectively. Geely Automobile announced that the assessed value of 100% equity of Lynk&Co Group, determined by an independent appraiser using a market approach, as of the valuation date is 18.328 billion yuan.
According to the announcement, in this transaction, Jike will purchase 20% equity of Lynk&Co from Geely Holding for a price of 3.6 billion yuan; Acquiring 30% of Lynk&Co's shares held by Volvo for a price of 5.4 billion yuan.
On this basis, Jike will also subscribe to Lingke's newly added registered capital at a price of 367 million yuan. Following the completion of the Lynk&Co acquisition and investment, Jike will own 51% of Lynk&Co's shares.
On November 14th, Volvo, as a shareholder of Lynk&Co, announced the sale of its 30% stake in Lynk&Co to Jike for a consideration of 5.4 billion yuan. The consideration will be paid in cash, with 70% of the amount to be paid upon completion of the transaction, and the remaining 30% plus interest to be paid one year after completion of the transaction. The transaction is expected to be completed in the first quarter of 2025.
Volvo stated that Volvo Cars has been a minority shareholder of Lynk&Co since its establishment in 2017. This divestment is related to the new stage of Lynk&Co's future development, which includes the company's new ownership structure. Volvo Cars will continue to focus on operational cooperation with Lynk&Co in specific markets that are of strategic interest to both parties.
Public information shows that Lynk&Co was founded in 2017 as a joint venture between Geely Automobile Group and Volvo Car Group. After its product was launched, it quickly formed a unique style in the market and achieved 1 million sales in six years.
Jike launched its first new car, Jike 001, in 2021, becoming a representative brand of independent high-end new energy. The establishment of Jike Automobile was aimed at the rapid development of the new energy vehicle market, and at the beginning, it also undertook the task of driving Geely's new energy transformation. In just over 500 days, it achieved sales of 100000 vehicles and was listed on the New York Stock Exchange within three years.
On September 1, 2024, Geely released the "Taizhou Declaration", announcing that since the company's transformation from strategic expansion to strategic focus, various business segments under Geely are accelerating their integration efforts.
Li Shufu, Chairman of Geely Holding, stated that in order to stand out in the fiercely competitive market environment, Geely Holding issued the "Taizhou Declaration" in September this year, announcing that the company has entered a new stage of strategic transformation. This strategic integration is a key measure to implement the declaration, which will have a profound impact on the coordinated development of various brands, improve innovation capabilities, profitability, and sustainable development momentum, and thus form a stable operating situation, creating greater value for users and investors.
Regarding the merger of Jike and Lynk&Co, Geely stated that Jike and Lynk&Co will strengthen collaboration in technology, products, supply chain, manufacturing, marketing and services, and international market expansion, enhance technological innovation capabilities, stimulate economies of scale, and strive to build Jike and Lynk&Co into a globally leading high-end luxury new energy vehicle group with annual production and sales of millions by the end of 2026.