Chinese car manufacturer Geely Holding must secure a loan of 18 billion Danish kroner to refinance its stake in Volvo AB.
Geely Holding has arranged a new loan totaling $2.6 billion to maintain its investment in the truck manufacturer Volvo AB.
The company, which owns both Volvo Cars and Polestar, also holds a substantial stake in the truck brand that shares a similar name.
According to Bloomberg, the loan is syndicated, involving funds from 20 different banking institutions.
The borrowed amount of $2.6 billion is intended to refinance an existing three-year loan of 29.7 billion euros, which is set to mature in May.
Geely Holding's stake in Volvo AB represents 4.4 percent of the capital while accounting for 14.7 percent of shareholder voting rights.
Geely and Polestar’s Ongoing Debt Struggles
Geely’s financial maneuvering isn’t limited to its Volvo AB stake.
Its subsidiary Polestar, a struggling EV brand, has also been forced to secure additional capital to cover existing debt.
Just months ago, Polestar took out multi-billion dollar loans to stay afloat.
Last year, Geely sold off its entire stake in another sister brand, shifting ownership dynamics within its corporate umbrella.
At the same time, Geely’s ownership share in Polestar shrank significantly, signaling a potential restructuring of its automotive investments.
