Volvo Cars to propose a distribution of 62.7 percent of its Polestar shareholding to its shareholders

The Board of Directors of Volvo Car AB (publ) (“Volvo Cars”) resolved to propose a distribution of 62.7 percent of Volvo Cars’ shareholding in Polestar Automotive Holding UK PLC (“Polestar” and the “Polestar Shareholding”) to Volvo Cars’ shareholders at its 2024 Annual General Meeting (“AGM”). If the AGM approves the proposal, Volvo Cars’ shareholding in Polestar will amount to an ownership stake of 18.0 percent of Polestar’s total outstanding shares. 

The proposed distribution follows the evaluation of the Polestar Shareholding that was communicated on 1 February 2024 and will enable Volvo Cars to concentrate its resources on the next phase of its transformation. Volvo Cars will therefore not provide further funding to Polestar. Going forward, Geely Holding will continue to provide operational and financial support to Polestar. Volvo Cars’ and Polestar’s strong operational collaboration across R&D, manufacturing, after sales and commercial will continue to the benefit of both companies and as Volvo Cars has significant collaborations with Polestar and a financial relationship through the outstanding convertible loan of USD 1 billion, Volvo Cars will remain with an 18.0 percent stake, and thereby continue to have influence over Polestar.

The transaction

Jim Rowan, President & CEO of Volvo Cars, commented:

“As we embark on the next stage of our transformation, gearing up to lead in next-gen mobility, our focus sharpens on Volvo Cars’ development. The proposed distribution positions Volvo Cars strategically, and provides direct exposure to the Polestar share for our shareholders. As we have significant operational collaborations with Polestar and a financial relationship, it is logical for us to retain influence through a smaller 18.0 percent stake in Polestar. That said, Volvo Cars will not provide further funding to Polestar. With Polestar’s strengthened business plan, the launch of Polestar 3 and Polestar 4, and Geely´s commitment and support, the company is well positioned for growth.”

Daniel Donghui Li, CEO of Geely Holding, commented:

“We express our support for the proposed distribution of Polestar shares to Volvo Cars’ shareholders. We have strong confidence in Polestar and look forward to 2024 with great optimism based on the strong and attractive product portfolio, which reaffirms Polestar’s position as a global premium EV brand. As long-term owners of Polestar, we are committed to supporting their announced business plan and financial targets by securing the necessary funding to execute its strategy, and through our global ecosystem of technology, supply chain, and product development. At the same time this enables Volvo Cars to fully focus on its transformation and invest in developing Volvo Cars.”