Geely Automobile has announced an offer to privatize its unit Zeekr, valuing the company at $6.52 billion through a $2.2 billion acquisition of the remaining 34.3% stake.
The proposal includes a payment of $25.66 per Zeekr American Depositary Share (ADS), representing a 13.6% premium over Tuesday’s closing price. Following the announcement, Zeekr’s shares rose 11.11% in U.S. premarket trading to $25.10.
According to the company, Zeekr will be fully integrated into Geely Auto upon completion of the transaction. Chairman Li Shufu stated that the move responds to intense market competition and a complex economic landscape, in line with the principles of the “Taizhou Declaration.”
Geely Holding, parent company of Geely Auto, Zeekr, and Volvo, has shifted its strategy from aggressive acquisitions toward operational streamlining and cost reduction, amid a price war in China’s auto sector. The group has reorganized its brands into two divisions: Geely Auto for the mass market and Zeekr Group for the premium segment.
In March, the company merged three units employing nearly 2,000 engineers into a unified team focused on digital cockpit systems.
Zeekr, established in 2021 as a premium EV brand, incorporates Geely’s in-house technologies, including EV architecture and battery systems. In Q1, Zeekr delivered 41,403 vehicles, marking a 25% year-over-year increase, and outperformed BYD’s premium brand Denza.
The brand went public in the U.S. in May 2023 at a valuation of $6.8 billion, becoming the first major Chinese listing in the country since 2021.
Geely’s announcement follows Zeekr being named in a letter by two Republican lawmakers to the U.S. Securities and Exchange Commission (SEC), urging the delisting of 25 Chinese firms over alleged military ties. Zeekr has not commented on the letter.
More than 100 Chinese companies are currently listed on U.S. exchanges, with a combined market capitalization of around $1 trillion. Investor concerns over potential forced delistings have reemerged amid ongoing U.S.-China trade tensions.
China is reviewing a U.S. proposal to resume trade talks following Washington’s announcement of 145% tariffs. In response, China has identified U.S.-made products eligible for exemption from its 125% retaliatory tariffs.
