Chinese carmaker Geely will be acquiring a 8.2 percent stake in Volvo AB, making it the biggest single shareholder of the truck- and bus-making arm of Swedish automotive giant Volvo.
This follows Geely's recent acquisition of Terrafugia, a Boston-based company which is building flying cars, last month.
Geely is best known to Malaysians as the new decision-makers in British luxury carmaker Lotus and Proton Holdings Bhd, which they acquired earlier this year.
According to the New York Times, Geely's acquisition of Volvo AB equity was valued at US$3.2 billion (RM13 billion) and comes at a time when the Chinese government is actively barring companies from moving money abroad.
"It is the latest sign that Chinese companies are still on the lookout for deals - provided they are in line with the government's strategic goals.
"Entertainment and real estate purchases are not likely to pass muster, but industrial, mining and energy companies often get the green light. The approach fits the government's agenda.
"China is trying to build geopolitical ties overseas with large infrastructure projects that depend heavily on steel, cement and machinery.
"At home, it wants to develop domestic giants in areas like artificial intelligence and renewable energy to compete with Western stalwarts," read the report.
According to the Wall Street Journal, the Volvo deal means Geely would have a global presence with an expansive portfolio - mass market, premium, luxury and commercial vehicles.
However, a Volvo AB spokesperson told WSJ that discussions with Geely have yet to take place, and it was too early to say what the consequences might be.
Financial Times cites Geely Holding chairperson Li Shufu as stating that he was delighted with the deal.
"Given our experience with Volvo Car Group, we recognise and value the proud Scandinavian history and culture, leading market positions, breakthrough technologies and environmental capabilities of Volvo AB," he said.