"This is a historic day for Geely, which is extremely proud to have acquired Volvo Cars," Geely Group chairman Li Shufu said in a statement, promising continuity for Volvo but also stressing Geely's ambitions for the brand in China's booming market.

Known for its family-friendly cars, Volvo "will remain true to its core values of safety, quality, environmental care and modern Scandinavian design as it strengthens the existing European and North American markets and expands its presence in China and other emerging markets," Li said.

Geely said Monday it paid 1.5 billion dollars for Volvo, less than a quarter of what US auto giant Ford dished out for the Swedish company in 1999.

The deal will give the ambitious Chinese a brand known for its safety and sturdiness, key attributes in building up its position among Chinese carmakers.

Although complimentary, the two brands could not be more different -- Geely has a mere 13 years of experience in the luxury car market and sells fewer cars than its new purchase, which was founded in 1927.

Li earlier told China's official Xinhua news agency that he hoped to see the struggling Swedish brand regain its former strong reputation.

"After the takeover, Geely remains Geely and Volvo is still Volvo. The relationship between the two companies is brotherhood and not a parent-and-child relationship," Li was quoted as saying.

The Swedish brand will keep its headquarters and plants in Sweden and Belgium; management will retain autonomy under a board headed by Li.

Geely named German Stefan Jacoby, the head of Volkswagen in America, as Volvo's new president and chief executive.

Geely paid 1.3 billion in cash along with a note of 200 million dollars, less than the 1.8 billion dollars price tag announced on March 28. Geely said this reflected "adjustments in areas such as pension obligations and working capital."

Geely also said it would invest 900 million dollars to improve the brand.

Both the European Union and China cleared the takeover last month.

Swedish union IF Metall said it welcomed news that Volvo's headquarters would stay in Sweden and hoped the carmaker's entry into the Chinese market would have a positive effect for employment.

"It is good that the deal has now been completed. It gives peace of mind to the employees who have been waiting for a long time for a clear answer," union chairman Stefan Loefven said in a statement.

Loefven, who is scheduled to visit China in coming months, added that the union expected the new owners would work according to the Swedish model "in which unions and businesses have close and developed relationships."

Geely, founded in 1986, has become one of China's biggest private car makers since launching its auto manufacturing business in 1997.

It sold 326,710 cars last year but has never managed to sell more than 200,000 abroad.

Volvo has been loosing money since 2005 and sales were weak in 2008 and 2009, but bounced back 20 percent this year as the global economy picked up again.

Dong Yang, executive vice president of the China Association of Automobile Manufacturers, meanwhile told Xinhua that maintaining Volvo's brand and product quality would be a difficult task.

He said raising Volvo's market share in China and adapting the European brand to China would not be easy.

"All of these things should be realised step-by-step through hard work," Dong was quoted as saying.

Shares in Hong Kong-listed Geely Automobile rose 5.86 percent to 3.07 Hong Kong dollars (40 US cents) on Monday.

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