Volvo Car AB’s Chinese owner is reducing the amount it’s seeking to raise to about 20 billion kronor ($2.3 billion) in its initial public offering, joining the growing roster of offerings being cut.
The carmaker, owned by China’s Zhejiang Geely Holding Group Co., set a price of 53 kronor a share, at the low end of its initial range, according to a statement Monday. The listing initially planned to raise about 25 billion kronor with trading to start on Oct. 28.
A glut of similar listings and the hard-to-value stake Volvo Cars owns in electric sportscar-maker Polestar has curbed investor appetite for Volvo under the originally planned terms, according to people familiar with the plans. Those plans projected a valuation of between $19 billion and $23 billion.
Volvo Cars seeks to sell only fully electric vehicles by the end of this decade and to build a battery-cell plant in Europe. The company had planned to use the IPO funds to add carmaking capacity so it can almost double annual sales to 1.2 million vehicles by 2025.
European companies including Dutch consumer-electronics retailer Coolblue NV and health-care property company Icade Sante SAS put IPO plans on ice in recent weeks as investors became picky about where they put their money amid a flurry of deals. Equity markets worldwide have also turned volatile amid soaring energy prices, faster inflation and a debt crisis at China Evergrande Group.
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