Moody's continues to review Geely's Ba2 ratings for upgrade
[ET Net News Agency, 25 July 2017] Moody's Investors Service continues to review Geely
Automobile Holdings Limited's (00175) Ba2 corporate family and senior unsecured ratings
for upgrade following its announcement of a proposed joint venture for the production and
sales of vehicles under the Lynk & Co brand.
The rating review was initiated on 12 July 2017, reflecting Geely's increased market
share, improved profitability in terms of its EBITA margin net of subsidies, consistent
low debt leverage, and strong liquidity positions, as evidenced by its latest business
On 20 July, Geely announced that it had entered into a memorandum of understanding with
parent company, Zhejiang Geely Holding Group Company Limited, and Volvo Car Corporation
(VCC), a subsidiary of Volvo Car AB (Ba2 stable), regarding the proposed formation of a
joint venture company for the production and sales of vehicles under the Lynk & Co brand.
"We continue to review Geely's ratings for upgrade, and will assess the impact of the
proposed Lynk & Co joint venture on the company's credit and business profiles as part of
our review for upgrade," said Gerwin Ho, a Moody's Vice President and Senior Analyst.
The formation of the joint venture company is expected to complete before Geely's
launching of the first model under the Lynk & Co brand in 4Q 2017, pending regulatory and
shareholders' approval. (KL)
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