Chinese car maker Geely has signed a deal to buy Volvo from Ford Motor Co. for $1.8bn (£1.2bn).
The agreement, which was first announced in December, is the biggest overseas purchase by a Chinese car manufacturer.
Geely’s chairman Li Shufu said “Today represents a milestone for Geely”.
Loss-making Volvo has been on the market since 2008, when Ford put it and several other brands up for sale. Jaguar and Land Rover in the UK have already been sold to India’s Tata Motors.
The deal represents a loss for Ford, however, having bought Volvo in 1999 for $6.5bn. Analysts view the deal as a good one for Volvo, which has struggled to grow sales and has not made a profit since 2005.
Geely, China’s biggest independent car maker has pledged to keep Volvo as a separate company with its headquarters remaining in Sweden.
However, significant manufacturing is expected to take place in China, making Volvos for Chinese consumers.
Geely says it expects annual sales in China to total 400,000 this year.
More than 13 million cars were sold in China last year – a rise of nearly 50% on the previous year.
Its international sales are tiny by comparison, however, and the company is expected to benefit from the foothold in the European market that Volvo will give them.