9:43 am, October 27, 2021
Volvo Cars has amended the size of its offering for when it lists on the stock market this week, setting its listing price at the bottom end of predictions and delaying until Friday.
The car maker will list on Nasdaq Stockholm on Friday, October 29, which is one day later than it had previously planned, for an extended application period and withdrawal rights.
The new listing price is a fifth of what Volvo’s owner, Geely Sweden Holdings AB, had originally said it was looking for, valuing the offering at around $18bn (£13bn) compared to the $23bn (£16.7bn) it was aiming for. It’ll now be listing for 53 kronor a share, at the lower end of its target range which went up to 68 kronor.
The new listing values Volvo at less than its electric sister brand Polestar, which is expected to list for $20bn next year in a special purpose acquisition.
In a company announcement Volvo revealed the fixed price and said there had been ‘overwhelming interest from Swedish and Nordic retail investors’. However, three years after it originally tried to list and pulled out, it is believed the delays and price drop are due to a lack of investor interest.
According to the Financial Times, Chinese car manufacturer Geely said on Friday it would be releasing more shares and dropping its stake from 98 per cent to 84 per cent in shares and voting rights after backlash from investors.
Håkan Samuelsson, CEO of Volvo Cars, says: ‘With the amended structure, we look forward to listing on Nasdaq Stockholm on Friday, which is a major milestone for Volvo Cars.
‘The proceeds raised from the IPO together with our strong balance sheet will secure the funding of our fastest transformer strategy and the delivery of our mid-decade ambitions.
‘We are very pleased with the strong support we have received from long-term institutional investors, and I would also highlight the very high level of demand from retail investors.
‘For all our shareholders, we will work hard to execute our business plan and create further value as a listed company.’
