Volvo Shareholders Accept Ford Deal

PARIS — Volvo shareholders approved the $6.5 billion sale of its car division to Ford Motor Co. with a simple voice vote March 8.

Mats Edenborg, a Volvo spokesman, said because many big shareholders had already publicly endorsed the sale, the vote was “not very dramatic. Shareholders were pleased with the sale to Ford and thought it was not only a good deal for Volvo cars, but also for the Volvo group.”

Its remaining divisions produce trucks, buses and construction equipment as well as marine and aerospace goods. The truck unit accounts for about 60% of total revenue.

The sale leaves Volvo cash rich and looking to expand its remaining “commercial products” businesses.



“Volvo has ambitious plans for its future growth — growth that will also contain elements of acquisitions,” its board of directors said in a statement released the day shareholders approved the sale.

“The strategy we are now choosing is not going to be implemented overnight,” the board said. “It is our impression that the shareholders have the willingness and patience to allow Volvo the time and freedom of action necessary to carry out its strategy.”

Volvo has appeared anything but patient in recent months. A month before the sale was announced, the company bought 12.85% share in Scania, surprising everyone, including Scania’s management. It then announced it wanted to merge the two companies, but talks with Scania’s biggest shareholder, Investor AB, broke down in February. Since then, Volvo reportedly has its eye on several acquisitions, including U.S. truck manufacturers Navistar International and Mack.

But now, Volvo is talking about taking its time in seeking acquisitions.

“The shareholders understand this is not something you do on your lunch break. It takes time,” Edenborg said.

Just hours before shareholders approved the sale of Volvo Cars, the board of directors announced it would like to use $1.1 billion of the proceeds from the sale to either buy back or redeem company shares, which is further evidence that the rush to acquire a truck manufacturer may be slowing down.