Volvo Car Group, owned by Chinese automakers – Geeley, stated on Thursday that they, along with China Development Bank (CDB) have signed a loan agreement pact. This joint venture was announced in Memorandum of Understanding of April 24, 2012 and speaks of the confidence and conviction that CDB has in Volvo Cars business strategy.
The two parties have signed a €922 million agreement with maturity in 2020 during which refinancing of Volvo Cars will be possible. This new agreement will also go a long way in enhancing loan maturity structure for the company.
Volvo Car Group has reported global retail sales to the tune of 35,864 units in the month of November 2012, a 6.5% decline as compared to sales in November 2011. Volvo XC60 crossover did well in US markets receiving a 26.8% boost in demand. United States are major markets for the Group and retail sales in the country during the month of November stood at 6,145 units. XC60 crossover sales alone stood at 2,068 units during the month up by 47% during the 11 month period January to November 2012.
Volvo Car Group signs loan agreement with China Development Bank
Volvo Car Group (Volvo Cars) and China Development Bank have signed a loan agreement under the umbrella of the strategic partnership, as announced in the Memorandum of Understanding of April 24 2012.
The loan agreement is testament to China Development Bank’s belief in the strength and viability of the Volvo Cars global business plan and corporate strategy.
As a first step under the agreement, the parties have signed a EUR 922 million loan with a maturity in 2020. This loan will be used for a refinancing of Volvo Cars’ current loans. The new loan will improve Volvo Cars’ loan maturity structure with approximately EUR 600 million in the coming years.