Enter your Email To Join Us For Free Today!

* Volvo to keep technology, IP it has developed

* Volvo will also keep access to necessary Ford IP

(Adds Geely and Ford statements)

By Michael Wei and Quentin Webb

BEIJING/LONDON, Nov 27 (Reuters) – Zhejiang Geely Holding
Group laid out how it and Ford Motor (F.N) plan to handle
intellectual property (IP) rights for Volvo Car Corp., clearing
a major barrier in its bid to acquire the Swedish brand.

Ford named Geely Holding, the unlisted parent of Geely
Automobile (0175.HK), as the preferred bidder for Volvo cars on
Oct. 28. No price was made public but media reports have
estimated it could be around $2 billion.

Geely said in an emailed statement on Friday that it
remained preferred bidder to buy Volvo outright, confirming
earlier remarks made to Chinese media.

“Volvo will retain ownership over key technologies and IP
that it has developed and will retain access to all Ford IP
[that] Volvo plans to use to implement its business plan,” Geely
said.

Geely added that owning Volvo would give it “access to a
significant suite of IP, including Volvo’s safety and
environmental IP.”

A number of Chinese carmaker are keen to break into foreign
markets and are aggressively developing their own brands while
moving beyond traditional offerings in the small, low-priced car
segment into more upmarket vehicles.

But intellectual property rights have been seen as a key
issue hindering Chinese carmakers from taking over struggling
overseas automakers.

Beijing Auto cited intellectual property as the reason
behind its failure to reach a deal with General Motors [GM.UL]
over its Opel unit in July. [ID:nPEK6722]

In October, similar concerns threatened to derail Geely’s
bid for Volvo, a source close to the talks said at the
time.

Volvo is more closely woven into Ford’s wider operations
than its other top-end European brands, Jaguar and Land Rover,
which it sold to India’s Tata Motors (TAMO.BO) last year.

A Ford spokesman said: “As in past divestiture agreements,
any agreement we reach with Geely would take into account issues
such as IP rights and protections and the engineering,
manufacturing and supply relationship between Ford and Volvo.”
(Additional reporting by Simon Rabinovitch in Beijing; editing
by Chris Lewis and Karen Foster)
(Visit the Reuters DealZone blog here)
(( This e-mail address is being protected from spambots. You need JavaScript enabled to view it ; +44 207 542 9405))