Volvo Cars shares tumbled as much as 14% on Friday morning after its parent company Zhejiang Geely Holding Group began a sale of around 100 million shares of the Swedish carmaker.
At 9 a.m. London time, shares of Volvo were down by 10.31% after trimming some losses. Shares had fallen by as much as 14% earlier in the day and hit a record low, according to Reuters data.
Volvo shares are down 25% year to date.
Geely said in a statement earlier on Friday that it would release further shares of Volvo, which was in line with its long-term strategy.
It said the move was designed to increase liquidity of Volvo and “offer more opportunities to generate sustainable long-term value for institutional and retail investors.”
Geely will still hold 78.7% of Volvo shares following the sale, the statement said. Geely previously owned around 82% of Volvo, putting the sold shares at over 3%.
The holdings were sold at a significant discount and the sale totaled around $350 million, Reuters reported.
As the majority shareholder, we remain steadfast in our commitment to continue our support of Volvo Cars on its transformation towards becoming a fully electric car maker, and we look forward to continuing this ongoing global success story,” Daniel Donghui Li, the CEO of Geely Holding Group said in the statement released Friday.
Geely did not immediately responded to a CNBC request for comment. A spokesperson for Volvo Cars directed CNBC to Geely when asked for comment.
Geely, which was founded by Chinese business mogul Li Shufu who is still its chairman, acquired Volvo Cars in 2010. The company’s portfolio includes a range of global car brands such as electric car giant Polestar and Smart, as well as Volvo.