Chinese billionaire Li Shufu (李書福) has bought a nearly 10 percent stake in Mercedes-Benz maker Daimler AG, making him the German group’s largest single shareholder, a stock market filing showed on Friday.
Li, who chairs auto giant Geely Automobile Holdings Ltd (吉利汽車), bought a 9.69 percent stake in the carmaker, worth about 7.2 billion euros (US$8.85 billion), according to the filing.
The size of the investment leapfrogs a 6.8 percent stake in the Stuttgart-based group held by Kuwait and Renault-Nissan Group’s 3.1 percent holding.
Photo: AFP
“Daimler is pleased to announced that with Li Shufu it could win another long-term orientated shareholder,” a spokesman for the Stuttgart-based group said.
Li had been “convinced by Daimler’s innovation strength, strategy and future potential,” he added.
German business media have for weeks reported Li and Geely’s interest in Daimler, but Friday was the first time Li’s stake crossed the threshold of 3 percent of stock, requiring a public notification.
Geely itself is no stranger to the European car business, having bought Sweden’s Volvo Cars Corp in 2010. It also owns British sports car manufacturer Lotus Cars Ltd and the firm that makes London’s world-famous black cabs.
In December last year, it advanced further onto Daimler’s turf, investing in AB Volvo, the world’s No. 2 truck manufacturer after the Stuttgarters.
However, in a speech to the CAR Institute automotive conference in Bochum, Germany earlier this month, Li skirted around the speculation, saying that Europe has “a very important role for the development of automotive brands under our leadership.”
The 54-year-old is 10th on Forbes magazine’s China Rich List and 209th on its global billionaires ranking, with an estimated net worth of US$16.6 billion.
His interest in Germany is the latest in a string of acquisitions by wealthy Chinese firms and individuals, including conglomerate HNA Group Co (海航集團), which owns an 8.8 percent stake in the nation’s biggest lender Deutsche Bank AG.
China’s avid search for footholds in Europe has raised hackles among some politicians in Berlin, Paris and Brussels.
Daimler overtook homegrown rival BMW to become the world’s largest luxury car maker by unit sales in 2016, helped by a broad refresh of its model range and powerful sales growth in China.
It reported a 24 percent leap in net profits last year, to 10.9 billion euros, when it presented its annual earnings earlier this month.
Geely’s investment arrives as Daimler begins moving away from a classic German conglomerate model that shareholders complain is too rigid.
It is to become a holding company combining three divisions: financial services, cars and small commercial vehicles and trucks and buses.
The Stuttgart firm is unusual among its German peers in lacking a single controlling shareholder, whereas Volkswagen is dominated by the Porsche-Piech clan and BMW by the Quandt-Klatten family.
Executives hope the reform will make Daimler more flexible as it adapts to a changing environment for the industry, electrifying a growing share of its range and offering new digital services such as ride or car-sharing.
Electric vehicles are especially critical to the massive Chinese market, where Beijing is preparing to impose quotas for emissions-free vehicles on manufacturers.
Daimler is making Mercedes-Benz cars for the Chinese market locally via a joint venture with partner BAIC Motor Co (北京汽車).
The company told business daily Handelsblatt on Friday that its relationship with BAIC remains solid.
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