The Chinese businessman who owns the Geely automotive group has acquired a US$9-billion stake in Daimler, the German maker of Mercedes-Benz cars and trucks.
The investment by Li Shufu, which Daimler confirmed on Friday in a regulatory filing in Germany, represents 9.69% of the company.
In a statement, Daimler said it was pleased to have Li as a “long-term-oriented shareholder” and described him as “an especially knowledgeable entrepreneur with a clear vision for the future, with whom one can constructively discuss the change in the industry".
Li, 54, is the chairman of Zhejiang Geely Holding Group, which owne the Chinese carmaker Geely Automobile, as well as Volvo Cars, the Swedish automobile brand. Daimler has a partnership in China with a separate, state-controlled company, Beijing Auto.
“Daimler has a broad-based portfolio and footprint in China,” Daimler said, noting that Beijing Auto remained “a strong partner on site".
The Daimler stake was purchased by an investment company headed by Li called Tenaclou3 Prospect Investment, according to the Daimler filing.
Geely could not be reached for comment.
Li is from Zhejiang, a coastal province south of Shanghai. He got his start in business in refrigerator manufacturing in 1986, and moved into motorcycles and then automobiles in the 1990s. He is now one of the wealthiest people in China, with a net worth estmated by Bloomberg at $13.8 billion.
Li has been working to acquire an array of global automotive holdings and turn Geely into the dominant player in China.
Reports of his interest in purchasing a Daimler stake had been appearing in the German media for weeks. This month he appeared by video at an automotive conference in Germany, but did not discuss the matter. “Building up brands in the European market has been the goal from the start,” he said, according to a translation of his remarks.
Last year, Geely Holding bought a 51% stake in Lotus, the British sports car maker. It also owns the company that makes London’s well-known black taxi cabs. With Li’s backing, Volvo recently outlined plans to create a brand of upscale electric cars, called Polestar, that is intended to compete with Tesla.
In the Chinese market, Geely Auto has become a top-selling brand. It sold more than 1 million vehicles last year. Geely Holding has also started an automotive brand, Lynk & Co, aimed at wealthier buyers.
Daimler sold 2.3 million Mercedes-Benz cars worldwide last year, about a quarter of them in China. The company also makes commercial vans, trucks and buses.
Ferdinand Dudenhoffer, a professor who runs an automotive research centre at the University of Duisburg-Essen, said many people in Germany were cautious about investments by Chinese companies. “They need China — however, they also fear it,” he said in an email.
He added that Geely could give Daimler an important partner. “With Mr Li and Geely, Daimler has open access to the largest market of the world,” he said.
Daimler and other automakers are scrambling to develop electric vehicles to comply with increasingly stringent emissions standards that will take effect in China and Europe in the coming years. Daimler is working on both electric cars and battery-powered trucks.
Volvo announced last year that all of its models would be hybrids or electric cars by 2019.