Volvo Cars has signed an agreement with its parent, Geely Holding, to acquire Geely Holding’s stake in the companies’ joint ventures in China, with the aim of taking full ownership of its car manufacturing plants and sales operations in the country.

The acquisition of an additional 50 per cent of the shares in Daqing Volvo Car Manufacturing Co., Ltd and Shanghai Volvo Car Research and Development Co., Ltd will further strengthen Volvo Cars’ position in China, its largest market, and maximise exposure to one of the fastest-growing regions globally.

Although the two joint-venture companies are already fully included in Volvo Car Group’s financial statements, Volvo Cars’ share of their net income and equity will increase following the transaction.

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Håkan Samuelsson, chief executive of Volvo Cars said: “With this agreement, Volvo Cars will become the first major non-Chinese automaker with full control over its Chinese operations.”

The transactions will be completed in two steps, starting in 2022 when the joint venture requirement for auto manufacturing in China will be lifted, and expected to be formally completed in 2023.

The transactions are pending regulatory approvals.

Employees and partners within the relevant companies will not be directly affected by the transactions.