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China Briefings

Reports on China issued by Samsung Economic Research Institute

China Business Intelligence No. 201

China Business Intelligence No. 201

Samsung Economic Research Institute Beijing Office

Aug. 9, 2011

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In 2010, Geely, a private automobile manufacturer, completed its acquisition of Ford Motor Co.'s money-losing Volvo unit. While other Chinese companies had difficulties acquiring foreign companies due to non-economic factors, Geely's acquisition of Volvo proceeded relatively smooth.  Since the acquisition, Geely has managed Volvo as an independent subsidiary, and does not directly interfere with Volvo's normal operations. In the process of acquiring Volvo, Geely's management team repeatedly stressed the fact that it would run Volvo independently without merging Volvo with its other businesses. Geely's decision to run Volvo independently left much of Volvo's previous managerial problems unresolved. And Geely has run into various problems in the absorption process.

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