Ford denies Volvo sell-off talks

Our Corporate Bureau
16 July 2007

Ford Motor has denied that it is in talks about selling off its Swedish car automotive unit Volvo, part of its Premier Automotive Group, in the midst of reports over the weekend that it had decided to sell Volvo, but the timing of the sale had yet to be decided.

According to the reports, the review of Volvo was still at a very early stage and may not result in a sale, adding that Ford had so far not hired financial advisers for the operation.

A Ford spokesman denied any talks on the scale of Volvo, which Ford bought from its Swedish owners in 1999 for $6.45 billion.

In May, Swedish newspaper Goteborgs Posten reported on its website, that BMW is studying a possible purchase of Volvo, citing a source within Ford. (See: Ford may sell Volvo car unit to Germany's BMW)

Last week, a German newspaper ran aninterview with Stefan Krause, chief financial officer, BMW, in which he said that BMW had not ruled out takeovers of other carmakers or brands, fuelling speculation about Volvo's takeover, although he was also quoted as having said any talk of a bid for Volvo Cars was "pure speculation".

However, the speculation led to an accidental 5 per cent rise in the shares of Swedish truck maker Volvo, due to confusion, as investors mixed up the Swedish truck maker with the Ford-owned auto maker.