China’s National Development and Reform Commission (NDRC) approved the establishment of a joint venture between the Volvo Group and Dongfeng Motor Group Company Limited. Before completion of the transaction, additional authority approvals are to be obtained.
As announced in January 2013, AB Volvo signed an agreement with the Chinese vehicle manufacturer Dongfeng Motor Group Company Limited (DFG) to acquire 45% of a new subsidiary of DFG, Dongfeng Commercial Vehicles (DFCV), which will include the major part of DFG’s medium- and heavy-duty commercial vehicles business.
Through the approval by NDRC an important step has been taken towards completion of the transaction. Completion is subject to certain conditions including the approvals of other Chinese authorities, which have not yet been obtained.
Completion of the transaction is currently expected to take place mid-2014. At completion of the transaction, the Volvo Group will significantly strengthen its position in the medium-duty and heavy-duty truck segment.
The National Development and Reform Commission (NDRC) is a macroeconomic administrative agency under the Chinese State Council, with administrative and planning control over the Chinese economy.