DRB-HICOM Berhad (DRB-HICOM) has reached an agreement with China-based Zhejiang Geely Holding Group Co., Ltd (Geely Holding) for the Chinese automotive group to acquire 49.9% equity in Proton Holdings Berhad.
The deal will also see Proton sell its entire equity in British carmaker Lotus to Geely Holding, which will see the Group exit the sports car segment. Geely Holding will acquire a majority share of 51% of Lotus from Proton.
Both parties expect to sign the Definitive Agreement before the end of July 2017.
The deal will enable Proton to tap into Geely Holding’s vast range of platforms and powertrains, and will also enable Proton to have access to existing markets of the Chinese carmaker, as well as right-hand drive markets in south-east Asia.
DRB-HICOM Group Managing Director, Dato’ Sri Syed Faisal Albar says the Proton brand will remain present and will grow significantly with the new foreign strategic partner on board.
“Our intention was always to ensure the revitalization of the Proton nameplate. It was Malaysia’s first national car brand and has more than 30 years of history. This deal will be the catalyst to elevate a brand that Malaysians resonate with,” said Syed Faisal.
Geely Holding Group Executive Vice President and CFO Mr. Daniel Donghui Li commented, “With Proton and Lotus joining the Geely Group portfolio of brands we strengthen our global foot print and develop a beachhead in South East Asia. Geely Holding is full of confidence for the future of Proton, we will fully respect the brands history and culture to restore Proton to its former glory with the support of Geely’s innovative technology and management resources. We also aim to unleash the full potential of Lotus Cars and bring it into a new phase of development, thanks to our experience accumulated through Volvo Car’s revitalization.”
Geely Holdings, which also owns Volvo Car Corporation and The London Taxi Company, is one of the leading passenger vehicle carmakers in China. It already has facilities across the globe, including 16 manufacturing plants, 7 design studios and 5 research & development centres. The deal with Proton will offer Geely access into the key ASEAN market, and also R&D and manufacturing presence in the region.