Well, that didn’t take long. Just a little over a year after Zeekr (ZK) went public on the U.S. markets, the Chinese EV brand is now heading back under the full wing of its parent company, Geely (GELYF).
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Zeekr, which debuted in May 2024 with big ambitions and even bigger design statements, announced Tuesday that it will be acquired by Geely Automobile Holdings in a deal offering shareholders $2.687 per Zeekr share or 1.23 shares of Geely stock. For those holding the U.S.-listed ADRs, that translates to $26.87 in cash or 12.3 Geely shares per Zeekr ADR.
At first glance, the cash offer might seem underwhelming; it’s slightly below Monday’s close of $27.82. But here’s where things get interesting; Zeekr’s ADRs were actually trading below $26 just a few weeks ago. And Geely’s stock price, which determines the value of the share-exchange option, has been gaining steam, putting that stock-swap value closer to $28.50. That premium is likely why Zeekr ADRs nudged up more than 1% on Tuesday morning.
What This Means for Zeekr Investors
Let’s be honest, Zeekr’s IPO was never just about short-term profitability. The company sold over 220,000 vehicles last year, and while it hasn’t yet turned a profit, it carved out a brand identity fast, positioning itself as China’s luxury-tech EV contender. The merger provides Zeekr with more operational stability and resources under the Geely umbrella, while letting it offload the pressure of delivering Wall Street growth each quarter.
For existing investors, this deal gives two paths forward: take the cash and walk away with a modest return (especially if you bought near the IPO price of $21), or hold on via Geely shares and bet on long-term upside from one of China’s most connected auto empires.
Geely Gets Bigger and Smarter
From Geely’s side, the aim of the merger is to achieve a strategic tightening of its EV portfolio. Geely already owns or holds major stakes in Volvo (VLVLY), Polestar (PSNY), Lotus, and more. By absorbing Zeekr completely, it reduces public-market overhead while streamlining branding and internal R&D. It’s also a clear sign that Geely sees more value in bringing its high-growth EV brand in-house rather than keeping it as a partially public experiment.
The current situation is that China’s EV market remains fiercely competitive, and brands are fighting for every inch of margin. Geely’s profit-making status gives it breathing room, and folding Zeekr into its operations could allow it to consolidate costs, share tech across brands, and scale faster.
So, What’s the Market Saying?
Zeekr ADRs rose slightly on Tuesday, and that’s mostly a reaction to the deal terms and the math favoring the share-exchange route over cash. Investors appear to be betting that Geely’s stock will keep rising — and they might be right. Geely shares are still undervalued compared to Western automakers, especially when you factor in the company’s broad EV exposure, its international reach, and profitability.
Still, the takeover does put an end to Zeekr’s solo market journey, at least for now. And while some may be disappointed that Zeekr didn’t have more time to prove itself on its own, this move could unlock more value in the long run, particularly if Geely continues to push its brands deeper into overseas markets.
Is Geely Automobile Stock a Buy or Sell?
Geely Automobile Holdings has earned a clear vote of confidence from Wall Street. The stock currently holds a Strong Buy consensus rating, based on seven analysts who have all issued Buy ratings in the past three months. There are no Hold or Sell ratings.
The average 12-month GELYF price target stands at $2.84, suggesting a 23.48% upside from the current trading level of $2.30.
