Zeekr, a prominent electric vehicle company, made headlines when it went public in May 2024. The majority stakeholder in Zeekr is Geely, holding a significant 65.7% of the company. Geely’s CEO, Li Shufu, believes that this strategic move will help Geely stay ahead of the competition in the increasingly competitive EV market.
Recently, rumors have surfaced suggesting that Zeekr may go private again. These rumors originated from Chinese social media platforms, where Li Shufu proposed the idea of Geely purchasing the remaining shares of Zeekr and taking the company private. Shufu emphasized that this decision would lead to better internal management and resource optimization, ultimately making Geely more competitive on a global scale.
The market’s response to this news has been positive, with Zeekr’s stock price seeing an 11% increase since the announcement. However, for Geely to acquire the remaining shares, they would need to come up with a substantial $2.2 billion. Despite the potential privatization, Shufu reassured that Geely and Zeekr would continue to collaborate with US and international financial markets.
The consolidation of Zeekr and Lynk & Co under one group indicates a step towards streamlining Geely’s diverse portfolio of brands. With Zeekr at the forefront of EV development within the Geely Group, this consolidation could lead to better cross-brand collaboration and innovation.
Geely’s extensive brand portfolio, which includes Sino-Swedish premium EV brands, mid-range brands, and other acquisitions like Smart and Lotus, raises concerns about sustainability. The industry may see more consolidation in the future to ensure long-term success and profitability.
In conclusion, the potential privatization of Zeekr by Geely signifies a strategic move to enhance internal operations and streamline resources. This decision could pave the way for improved collaboration within the Geely Group and position the company for greater success in the competitive EV market.