DEARBORN, Mich. — Ford has officially found a buyer for Volvo. The company signed a definitive agreement with Zhejiang Geely Holding Group Co. Limited on Sunday.

Basically, the Chinese manufacturer will purchase 100 percent of Volvo Car Corp. and related assets for $1.8 billion.  

The payment will consist of a $200 million note and cash. The sale is expected to close sometime during the third quarter.

At the time of closing, the cash portion of the deal will be adjusted "for customary purchase price adjustments relating to pension deficits, debt, cash and working capital," according to Ford.

The net impact of this adjustment would likely mean that the cash proceeds to Ford would be lowered substantially, officials noted.

"Volvo is a great brand with an excellent product lineup. This agreement provides a solid foundation for Volvo to continue to build its business under Geely's ownership," stated Alan Mulally, Ford's president and chief executive officer.  

"At the same time, the sale of Volvo will allow us to further sharpen our focus on building the Ford brand around the world and continue to deliver on our One Ford plan serving our customers with the very best cars and trucks in the world," he added.

Upon completion of the sale, Ford said that it will still work with Volvo Cars "in several areas" to help facilitate a smooth transition. For example, Ford will supply Volvo with powertrains, stampings and other vehicle complements for varying periods of time. The automaker will also providing engineering support, information technology and tooling for common components, among other areas

However, Ford emphasized that it will have no ownership in the Swedish car company's business.

"The Volvo team has done an exceptional job of restructuring its business and remaining focused on delivering its plan during the sale process," stated Lewis Booth, Ford's chief financial officer. "With Ford's continued investment in Volvo, it has launched its best-ever product range and remained true to its core values — safety, quality, environmental responsibility and modern Scandinavian design.

"We look forward to continuing to work with Volvo Cars, and wish the management team, employees and new owners every success for the future," he continued.

Continuing on, there are also agreements between Ford and Geely regarding the use of intellectual property designed to "allow both Volvo and Ford to deliver their business plans and provide appropriate safeguards against misuse."

Per these agreements, Volvo Cars can grant sublicenses to certain portions of Ford's intellectual property used by Volvo Cars to third parties, including Geely.

Geely officials said Volvo Cars' existing manufacturing plants in Sweden and Belgium will likely remain open. Geely plans to be "exploring opportunities" to build Volvo units in new plants in China that will serve the local market there.

Under the agreement, Geely also said it will continue the "strong collaborative relationships" that Volvo has with its employees, unions, suppliers, dealers and customers.

Once the deal is completed, Volvo Cars will stand as a separate company. Officials said that it will have its own management team, which will be based out of Gothenburg, Sweden, and there will be a new board of directors, as well.

The board and management team will be charged with building Volvo's safety and environmental technologies and growing the company presence, including "ambitious plans in the fast-growing Chinese market."

"Zhejiang Geely would like to pay tribute to Ford's stewardship of the Volvo brand, and we look forward to continued cooperation as Volvo embarks on the next stage of its evolution with Geely," commented Li Shufu, chairman of Zhejiang Geely Holding Group Company Limited.

"China, the largest car market in the world, will become Volvo's second home market. Volvo will be uniquely positioned as a world-leading premium brand, tapping into the opportunities in the fast-growing China market," Li added. "We are pleased to have reached this agreement with Ford, enabling us to safeguard and strengthen Volvo's renowned brand heritage.

"This transaction will ensure Volvo's continued leadership in the premium segment, where it enjoys a global reputation for safety and environmental-friendly technologies. This famous Swedish premium brand will remain true to its core values of safety, quality, environmental care and modern Scandinavian design," he continued.

Stephen Odell, CEO of Volvo Cars, added, "The Volvo management team fully endorses Ford's sale of Volvo Cars to Geely. We believe this is the right outcome for the business, and will provide Volvo Cars with the necessary resources, including the capital investment, to strengthen the business and to continue to move it forward in the future.

"Geely has been very supportive of Volvo Cars' business plans and management team," Odell continued. "We look forward to building a strong relationship between Volvo Cars and Geely, and to maintaining a strong relationship with Ford in those areas where we will continue to work together to ensure a smooth transition."