Zhejiang Geely buys Proton, Lotus stakes for RM1bil


KUALA LUMPUR: DRB-Hicom Bhd and Zhejiang Geely Holdings Group have signed the final agreement, which sees the latter acquiring 49.99% of car manufacturer Proton and 51% of luxury sports car brand Lotus in a deal worth RM1bil.

Zhejiang Geely is buying the Proton stake for RM460.30mil, of which RM170mil is cash and the remaining RM290m will be in form of a transfer of the former's sports utility vehicle (SUV) platform Boyue for RM290mil.

The next step will see Proton venturing into the SUV market through the rebadging and later the development of its own SUV under the platform.

As for the Lotus stake, Zhejiang Geely will be paying 100mil pound sterling (RM540mil) to Proton for the 51% stake.

Prime Minister Datuk Seri Najib Tun Razak said on Friday that the signing of agreement cements the new beginning of strategic partnership between both companies.

''Following this strategic partnership, Proton will have the ability and resources to turn itself around and become an example of Malaysian success.

"Geely is a company with the right credentials and proven track record. I believe Geely has the ability and expertise to take Proton to new levels of success,'' said Najib.

Among those present to witness the signing were Chinese Ambassador to Malaysia Huang Huikang, Minister of Finance II Datuk Seri Johari Abdul Ghani, Second Minister of International Trade Datuk Seri Ong Ka Chuan, Prime Minister’s Special Envoy to China Tan Sri Ong Ka Ting, chairman of Zhejiang Geely Holding Group Li Shufu, president of Zhejiang Geely Holding Group An Conghui, and managing director of DRB-Hicom Datuk Seri Syed Faisal.

“The acquisition is expected to be completed in three months, after which Zhejiang Geely will form a core management team recruited from a pool of global candidates to ensure the smooth operation of Proton,” both companies said in a joint statement.

Li Shufu said: “As an iconic national brand, Proton epitomises the spirit of Malaysia. Our partnership with DRB-Hicom will enable Proton to become the industry leader in Malaysia and a top three brand in Southeast Asia. 

“We will also continue to expand Lotus’ product portfolio and increase production to further enhance its brand. 

"Furthermore, the deep regional knowledge we gain from Proton and Lotus through this transformative partnership, coupled with our technological expertise and leadership in innovation, opens the door for Zhejiang Geely to become a major player in the Asean market and will help us reach our sales target of three million units by 2020,” he said. 

Meanwhile, Syed Faisal said Zhejiang Geely -- which also owns Sweden’s Volvo Cars, London Taxi Company, LYNK & CO and the Geely Auto portfolio of car brands -- is the right partner for Proton.

“With Zhejiang Geely making Proton their right hand-drive hub for the Asean region, Proton can now target the immense Asean passenger car market for both our existing models and Geely’s models. 

“Proton’s status as Malaysia’s national car is secure, and DRB-Hicom remains a majority shareholder. Proton will now focus its efforts with Zhejiang Geely on gaining domestic market share,”  he said.

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights
   

Next In Business News

CPO futures likely to see technical correction next week
Evergrande says six execs redeemed investment products in advance
Infineon opens Austria plant early in chip capacity boost
Indonesia may reopen to tourists from some countries in October
Airbus reaches deal to restructure AirAsia jet order
Oil price falls as storm-hit US supply trickles back into market
World shares fall as markets await Fed meeting, taper timeline
Gadang’s subsidiary bags RM100mil deal
Big sales jump for EcoWorld Malaysia in Q3
The 18th entry

Stories You'll Enjoy


Vouchers