Ford expects to seal Volvo deal in 2010 Q2

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US carmaker Ford said it expected to close a deal to sell Volvo Cars to China's Zhejiang Geely in the second quarter of 2010, in the latest in a string of deals between Asian and Western carmakers.

Chinese carmakers are taking advantage of a crisis-sparked shake-up of the auto industry, tapping into Western brands in a bid to boost their technology and take advantage of a fast-growing home market. China car sales are expected to overtake the US when full-year figures are published.

Ford said in a statement it did not expect to retain a stake in the Swedish unit after the sale.

Geely said in a statement that the substantive commercial terms of the agreement had been settled, and that Geely expected to sign a definitive stock purchase agreement with Ford in the first quarter of next year, paving the way for completion in the second quarter, subject to regulatory approval.

``Further discussions will focus on finalisation of documentation and financing, as well as government approvals,'' Geely said in a statement.

Zhejiang Geely was named by Ford as preferred bidder for Volvo in October.

The estimated $US1.8 ($NZ2.5) billion deal would be the largest overseas acquisition by a Chinese automaker.

China's BAIC said it would launch an aggressive campaign to develop its brand at home and abroad after buying car designs from GM's Saab unit.

- Reuters