Geely Revs Up Stake in Danish Financial Company

Domestic car maker Geely will boost its ownership of Denmark’s Saxo Bank Group to a controlling stake, extending a recent foray by private Chinese investors into the European financial services sector.

Following its original purchase of 30% of Saxo in May, Zhejiang Geely Holding Group Co. Ltd., whose assets include the Swedish Volvo car brand, will buy more shares to raise its stake to 51.5%, Saxo said in a statement on Monday. Saxo, which describes itself as a “multi-asset trading and financial-technology firm,” said northern European financial services firm Sampo Group has also offered to buy up to another 19.9% of the company.

No financial terms of the purchases were disclosed. But Reuters reported that Geely would pay more than $300 million to boost its stake, while Sampo would pay 265 million euros ($310 million). Sellers of the latest stake include private equity TPG Capital, which holds 29% of Saxo, and SinarMas, which holds about 10%.

“With Geely we secure a strong position in core growth markets in Asia with greater China as center,” said Saxo Bank CEO Kim Fournals. “Sampo Group has a long and impressive history in financial services bringing a wealth of experience and insight in the financial sector.”

Both deals require regulatory approval and are expected to close within the next six months.

The deal would mark the latest move into Europe for Geely, which zoomed into global headlines in 2010 with its purchase of the Volvo car brand for about $1.5 billion. Three years later, the company also acquired London Taxi Co., maker of the British capital’s iconic taxi cabs. At the time of its original Saxo investment in May, Geely CFO Daniel Li called the move part of his company’s drive to expand into financial services.

The investment marks the latest in a growing series by private, nonfinancial Chinese firms into the European financial services sector. Before that, most such investments had come from a limited number of strategic purchases by China’s big state-run banks.

One of the earliest in the new generation of investors was Fosun Group, which in 2014 bought 80% of leading Portuguese insurer Caixa Seguros e Saude SGPS SA for 1 billion euros. Earlier this year, the diversified HNA Group purchased 3% of Germany’s Deutsche Bank and later boosted that to nearly 10%. And last month the diversified Legend Holdings, whose largest asset is the Lenovo computer brand, announced it would buy Banque Internationale a Luxembourg S.A., the oldest privately owned bank in Luxembourg, for 1.48 billion euros.

Contact reporter Yang Ge (geyang@caixin.com)