Volvo-Geely Deal, Done by Chinese New Year

Another important piece of the Volvo Geely puzzle has been put into place as, according to Reuters, Zhejiang Geely Holding Group wants to complete the acquisition of Ford Motor's Volvo unit in early 2010 and has hired consultants to advise with restructuring and integration.

The Chinese company hired Roland Berger Strategy Consultants to launch a 100-day internal review and restructuring, aimed at improving Geely's operations. They will focus on sales of Geely’s self branded cars in China.

"The Volvo deal sees no more hurdles," a source told Reuters. "It is expected to be done before Chinese New Year, and then Geely will quickly launch integration," said the source, who declined to be named due to the sensitive nature of the deal. Chinese New Year starts on Feb. 14.

In an attempt to look ahead, Geely Chairman Li Shufu, who is also the Chairman of the Hong Kong-listed Geely Automobile Holdings, decided to hire Deloitte Touche Tohmatsu, to work on post-acquisition integration for Volvo. The company will have a difficult mission, as the focus will be on the integration of marketing and sales in China, network distribution, logistics and joint global operations.

"Li Shufu wants to do something like Lenovo-IBM - have a foreign headquarters and a China headquarters," said the source.

"Personally, I think there is the likelihood of success of such mergers and acquisitions," said Wolfgang Bernhart, a partner at Roland Berger.