Merkel: No violations seen in Geely buy of Daimler stake

"I am particularly pleased to accompany Daimler on its way to becoming one of the world's leading electro-mobility providers". Li wants Geely and Daimler to cooperate in the areas of battery-powered cars, online services, trip-sharing, and digital technologies.

Li, the founder of Zhejiang Geely Holding Group Co., was set to meet Daimler Chief Financial Officer Bodo Uebber on Sunday in Stuttgart, where the Mercedes-Benz parent is headquartered, followed by Chairman and Chief Executive Officer Dieter Zetsche yesterday, according to people familiar with the matter.

Daimler clearly does not need any help in China, having sold close to 600,000 vehicles there last year, a gain of 26 percent.

Daimler's Feb. 13 earnings release for 2017 showed that the Chinese joint venture's revenue grew 32% to 15.37 billion euros ($18.9 billion), while profit from continuing operations after taxes jumped 62% to 2.35 billion euros. BBAC is an integral part of our global production network of Mercedes-Benz Cars.

Xu Heyi, chairman of BAIC, added: "With over a decade of remarkable achievements, BBAC stands as evidence of the strong collaboration between BAIC and Daimler".

Reports already surfaced in late November that Daimler had rebuffed advances from Li, who was seeking to acquire a small packet of around 5 percent.

Geely sees potential in Daimler because it is developing high-speed connectivity for autonomous cars at a time when Li believes satellite-based internet connections could become more important, the source familiar with his thinking said. They plan for Mercedes-Benz and smart cars to offer electric versions of all car models by 2022. Some of the major domestic manufacturers include the Warren Buffett-backed BYD, SAIC Motor, BAIC Motor, Great Wall Motor and Geely Automobile. The company blamed intensifying competition in the local passenger vehicle market, as well as "the overall sluggish Korean vehicle market", which led to a decline in sales at Beijing Hyundai Motor.

China is Daimler's largest market for the Mercedes brand. "Going forward, both partners will continue to support BBAC as it provides additional, attractive products, contributing to the development of the Chinese automotive industry". "It remains to be seen how Geely will leverage the ownership to reach other deals".

Ministers agreed last year to expand government powers to scrutinise takeover bids from abroad, especially in sectors affecting critical infrastructure, and to extend the range of deals eligible for official probes.

That could be complicated, though, by Daimler's existing relationships with companies in China. As a part of this investment, a plant in Beijing's Shunyi district that is owned by BAIC will be given to the Beijing Benz Automotive Co, and will be altered to manufacture Mercedes-Benzes.