(Yicai) Nov. 15 -- Shares of Zeekr Intelligent Technology Holding sank after parent company Geely Holding Group said the premium electric vehicle maker would take control of its more affordable sister brand Lynk & Co.

Zeekr [NYSE: ZK] plunged 23.7 percent to USD22.24 a share in New York yesterday, while Geely Automobile Holdings [HKG: 0175] fell 5.2 percent to HKD13.18 (USD1.70) in Hong Kong today.

Hangzhou-based Geely Holding said the integration of the two was intended to create a “new Zeekr,” targeting annual vehicle sales in excess of one million a year by 2026. Zeekr will acquire 51 percent of Lynk, while a Geely Holding unit will own the rest, it announced yesterday.

The shake-up aims to eliminate competition between the two in terms of market positioning, development capabilities, and sales networks, according to Gui Shengyue, chief executive officer of Geely Auto.

Their operations will remain independent, Zeekr CEO An Conghui noted, adding that they have different market positioning, with Zeekr covering the luxury market and Lynk the mid-to-high-end market.

Zeekr will focus on mid-sized and large luxury models, while Lynk will cater to the high-end market of small- and medium-sized autos. Both will turn out pure electric and hybrid vehicles, with the larger models being hybrids, he added.

Geely subsidiary Volvo also disclosed yesterday that it will sell a 30 percent stake in Lynk to Zeekr for CNY5.4 billion (USD746.5 million) in a cash deal expected to be completed in the first quarter of next year.

In addition, Zeekr bought another 20 percent stake in Lynk from its parent for CNY3.6 billion. It will also subscribe to 1 percent of Lynk's increased registered capital at a cost of nearly CNY370 million (USD51.2 million).

Furthermore, Geely Auto's controlling stake in Zeekr will increase to about 62 percent following Geely Holding's transfer of an 11.3 percent stake. Geely Holding owns nearly 40 percent of Geely Auto.

Editors: Xu Wei, Emmi Laine