#China #Hangzhou #electric vehicles #Lynk & Co #Zeekr Group

Overview of Zeekr Group's Strategic Moves

In a significant development in the automotive industry, Zeekr Intelligent Technology Holding Limited (commonly known as Zeekr Group), has made headlines with its latest strategic integration transactions involving Lynk & Co. This move not only highlights Zeekr's ambitions within the premium new energy vehicle sector but also its broader mission to innovate and create a comprehensive user ecosystem.

Strategic Integration Details

As announced on March 20, 2025, Zeekr Group finalized strategic integration transactions with entities within the Geely Group, a relationship that has been evolving since late 2024. Notably, Zeekr has acquired a 30% equity interest in Lynk & Co from Volvo Car (China) for approximately RMB 5.4 billion (around US$740 million), followed by an additional 20% from Geely Holding at a price of RMB 3.6 billion (about US$493 million). Further boosting its involvement, Zeekr subscribed to an increase in Lynk & Co's registered capital, contributing RMB 367 million (approximately US$50 million).

Upon completion of these transactions on February 14, 2025, Zeekr now owns 51% of Lynk & Co, while the remaining 49% is held by Ningbo Geely. This tactical maneuver not only strengthens Zeekr’s control but also aligns both companies for potential synergies moving forward.

Financial Implications and Pro Forma Results

To gauge the impact of these strategic actions, Zeekr has released unaudited pro forma condensed combined financial information. This data aims to reflect the financial position of the combined entities as if the integration had been completed at the start of the historical periods presented. Specifically, the pro forma data includes a combined balance sheet and income statement for the years ending December 31, 2023, and 2024.

This financial information is derived from:
1. Audited financial statements of Zeekr for the same periods under U.S. GAAP.
2. Unaudited consolidated financial statements of Lynk & Co following the same accounting principles.

The pro forma details reveal the context behind Zeekr’s operational adjustments, which include:

• - Total revenues reaching RMB 81,741 million in 2023, up to RMB 113,892 million by 2024, reflecting growth in both vehicle and service sales.
• - The cost of revenues also saw a corresponding rise, impacting the overall gross profit, which increased from RMB 11,642 million in 2023 to RMB 18,899 million in 2024.

The net loss figures were reported as RMB 10,149 million for 2023 and reduced to RMB 7,121 million in 2024, suggesting a path towards improvement, particularly given the context of expanding operations and integrating new assets.

Insights into Future Growth

Although the pro forma information provides a snapshot, it is essential to emphasize that it does not predict future performance post-integration, nor does it account for potential cost savings or operational synergies that could be realized. The strategic moves by Zeekr Group signal a reaffirmation of their commitment to lead in the electric vehicle landscape, focusing on innovation and sustainable practices.

Conclusion

As Zeekr Group continues to innovate and expand through strategic integrations like Lynk & Co, their vision of becoming a premier global provider of new energy solutions becomes clearer. Headquartered in Zhejiang, China, with ongoing development of e-powertrains and software systems, the company endeavors to align its growth with values of equality, diversity, and sustainability.

For ongoing updates about Zeekr Group’s activities and financial metrics, visit their investor relations page at Zeekr Group IR.