Chinese billionaire invested nearly $9 billion into Daimler

Beijing. February 28. Silkroadnews - Li Shufu, the billionaire chairman of Chinese car maker Geely (GELYF), invested about $9 billion buying a stake of almost 10% in Daimler (DDAIF), making him the biggest single shareholder in the owner of Mercedes Benz, CNN reports.
Li, whose personal wealth is estimated in excess of around $18 billion, has said he was not interested in acquiring Daimler. It's unclear exactly what he's after with such a big investment, but he dropped a big hint that the German company's engineering is central to his vision, the report reads.
“In order to succeed and seize the technology highland, one has to have friends, partners, and alliances and adapt a new way of thinking in terms of sharing and united strength,” the agency quoted Li saying.
Some analysts believe Li wants to gain access to Daimler’s clean energy technologies. This could help boost the competitive position of Geely in the Chinese electric vehicle market, which has already become the world’s largest market.
“Daimler has advanced technology that could be relevant to Geely, especially in the area of electric vehicles,” Bill Russo, founder and CEO of Shanghai-based investment advisory firm Automobility, said.
Previously, Daimler said it wants to invest €10 billion ($12.3 billion) in the development of clean energy. Russo said that components such as electric batteries and their control systems are of particular interest to Li and Geely.
Closer ties with Daimler can benefit Geely. On Monday shares of the Chinese company have already grown by 6.5% in Hong Kong.
Russo believes that Daimler may want to work with Geely on electric vehicles production, if it gives it more access to China’s huge market.
However, this can be hampered by existing Daimler relationships with companies in China. To conduct business in the country the foreign companies must establish joint ventures with Chinese firms. Daimler has already set several such enterprises, including the state-owned BAIC Motor and one with BYD, the manufacturer of electric vehicles and batteries, backed by Warren Buffett.
BAIC said on Friday that it and Daimler plan to invest nearly $2 billion into construction of a new plant to manufacture electric vehicles. Daimler said, after the investment made by Geely BAIC will remain its important partner in China.
“Geely has made several other moves in the European auto industry. In 2010, it bought Volvo Cars from Ford (F) for about $1.8 billion in a move marking its arrival on the international stage. Last year, it took control of Lotus, an iconic British sports car maker,” the report reads.