Zhejiang Geely Holding Group (Geely), a privately-owned Chinese automotive group, has finally settled commercial terms with Ford for its acquisition of Volvo Car Corporation.

Neither party have said how much the acquisition is worth but the Financial Times today reported that  the deal was in the region of $1.8bn to $2bn (£1.12bn to £1.25bn).

 

Geely is now expected to sign a definitive stock purchase agreement with Ford in the first quarter of 2010, paving the way for potential completion of the transaction in the second quarter of the year, subject to regulatory approvals.

Further discussions will focus on finalisation of documentation and financing, as well as government approvals.

Geely was named the preferred bidder for Volvo in October.

In recent weeks, Geely has held meetings with Volvo management, labour representatives and government officials in Sweden and Belgium – where its key manufacturing plants are based.

It is expected that production will continue in Europe as well as the new deal seeing production of Volvo cars begin in China.

“Geely is committed to work with all stakeholders to complete the transaction in the best interest of all parties, ” said Li Shufu, Geely chairman.

"Should a stock purchase agreement be finalised, Volvo will retain its leadership in safety and environmental technologies, and will be uniquely-positioned as a world leading premium brand to exploit opportunities in the fast growing China market."

More details will be made available once the expected definitive agreement is signed in the first quarter of 2010.