Volvo owner Geely will buy more than 6.8% of Mercedes-Benz's parent company Daimler, becoming the company's largest shareholder, according to German publication Bild am Sonntag.

The planned stake is as yet unspecified, but it's likely to exceed the 6.8% stake which the Kuwait Investment Authority holds in the company.

Previous reports from Chinese state media suggested that the Chinese giant would buy 3-5% of Daimler at a cost of USD4.8billion.

The acquisition would make Geely the biggest Daimler shareholder, also overtaking the Renault-Nissan-Mitsubishi Alliance, which owns 3.1%. Currently, 70.7% of Daimler is owned by institutional investors, while 19.4% is owned by private investors. Regarding the reported buying of shares by Geely, a Mercedes-Benz spokesman declined to comment.

Daimler previously rejected an offer by Geely to buy a stake at a reduced rate, but told the Chinese company that it could buy shares in the open market, according to Reuters.

The move is part of an aggressive expansion by Geely, which shot to prominence in Europe after acquiring Volvo in 2010 from Ford and went on to buy The London Taxi Company in 2012. It established the Lynk&Co brand in 2016 and acquired a majority stake in Lotus and almost half of Proton parent company DRB-Hicom this year.

Geely also recently bought the American flying car start-up Terrafugia, with an ambition to launch its first flying vehicle in 2019. It's thought that Geely may be looking into the deal to further its electric car strategy.

An analyst source confirmed that this is likely the case, saying: "With all the disruption in the market and luxury brands across the world working on their future investments in areas like EVs, autonomous vehicles and mobility as a service, the established brands will be regularly courted by new entrants so as to establish brand loyalty in new products (such as electric vehicles) and ensure cost effective use of new technologies.”