Chinese billionaire Li Shufu buys biggest single stake in Daimler

A general view of the headquarters of Zhejiang Geely Holding Group in Hangzhou Zhejiang province

China's Geely acquires $9 billion stake in Daimler

The Chinese businessman who owns the Geely automotive group has acquired a $9 billion stake in Daimler, the German maker of Mercedes-Benz cars and trucks.

Li changed tactics, and quietly amassed a stake of 9.69 percent worth U.S. 9 billion at Daimler's current share price.

The size of the investment leapfrogs a 6.8 percent stake in the Stuttgart-based group held by Kuwait and Renault-Nissan Group's 3.1 percent holding.

The share purchase makes Li Shufu now the single largest shareholder of Daimler AG and points to a long-term commitment.

Geely sees potential in Daimler because it is developing high-speed internet connections for autonomous cars at a time when Li believes satellite-based internet connections could become more important for the auto industry, the source familiar with his thinking said. They might bristle at the Geely relationship, but given their contract to make the Smart ForFour auto for Daimler, they are unlikely to ditch their combined stake.

The company paid 1.8 billion dollars to buy Volvo from USA carmaker Ford in 2010, bringing a renaissance to the Swedish-Chinese brand.

The group also took a 49 per cent stake in troubled Malaysian carmaker Proton in 2017, as well as a controlling interest in the British sports auto marque Lotus.

His interest in Germany is the latest in a string of acquisitions by wealthy Chinese firms and individuals, including conglomerate HNA which owns an 8.8% stake in the country's biggest lender Deutsche Bank.

In 2017, vehicle sales in China rose 3 percent to more than 28 million, leading the world for the ninth consecutive year, according to the China Association of Automobile Manufacturers.

It will become a holding company combining three divisions: financial services, cars and small commercial vehicles and trucks and buses.

Chinese media reports say Geely's purchase of Daimler shares is part of its effort to gain access to the German maker's battery technology, an essential component in the development of electric cars.

Photo A Mercedes-Benz assembly line operated by Daimler in Sindelfingen, Germany.

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