Ford confirmed that "all substantive commercial terms relating to the potential sale of (Volvo) have been settled," but added that "some work still remains to be completed before signing -- including final documentation, financing and government approvals."

The news sent Ford's stock above 10 U.S. dollars a share for the first time since 2005, prompting at least one analyst to raise his outlook for the company.

"The prospective sale would ensure Volvo has the resources, including the capital investment, necessary to further strengthen the business and build its global franchise, while enabling Ford to continue to focus on and implement its core One Ford strategy," the Dearborn automaker said.

According to analysts here, while Geely has some financing from Chinese banks, the announcement of Ford Wednesday aimed at helping China's largest private automaker secure additional loans and win government approval for the acquisition.