The chairman of Geely the Chinese carmaker has built up a stake of almost 10% in Daimler the owner of Mercedes Benz, making a bet of $9 billion that he will have success in pushing through an alliance so he can access the technology of the Germany company. "Now it wants more direct access to technology, brands and profits", he wrote in a note late on Friday, shortly after the stake was disclosed in a regulatory filing. According to Reuters, that makes Li Shufu, Geely's chairman, Daimler's single largest shareholder.
"We are delighted, with Li Shufu, to have won over another long-term investor who is convinced of Daimler's innovative prowess, strategy and future potential", the spokesman said.
Media reports said the purchase is part of the Chinese company's bid to form an industrial alliance with Daimler.
Daimler now has a joint venture with BYD in China to build electric cars.
The rumour mill has been working overtime since Daimler refused to sell a chunk of its stock at a discount to Geely Chairman Li Shufu past year, suggesting he might instead buy the stock on the market if he was so keen.
Geely, which declined to comment, approached Daimler in October to issue fresh equity in order to enter as a shareholder, according to two people familiar with the discussions, but was rebuffed. Geely also owns Britain's Lotus.
The deal, which is yet to be approved by Chinese regulators, has boosted Geely's existing overseas investment portfolio.
Geely Holding has increased its expansion drive.
It will become a holding company combining three divisions: financial services, cars and small commercial vehicles and trucks and buses.
Geely itself is no stranger to the European auto business, having bought Sweden's Volvo in 2010.
Li Shufu: "The competitors that challenge the global auto industry in the 21st century technologically are not part of the automotive industry today".