'DRB Hicom-Geely partnership will spur Proton's success'

'DRB Hicom-Geely partnership will spur Proton's success'

ZHEJIANG Geely Holding Group announced today that it has signed a final contract with DRB-HICOM of Malaysia, acquiring 49.9 percent shares of Malaysian automaker Proton and 51 percent shares of United Kingdom carmaker Lotus.

Of the sum, RM170.3 million is a cash injection while the remaining RM290 million comes from the valuation of Geely's popular SUV, Boyue, which it will produce in Malaysia using the Proton name.

"With ZGH on board, Proton can now eye the huge ASEAN passenger vehicle market with renewed confidence", he said.

Li Shufu, chairman of Zhejiang Geely Holding Company, said: "As an iconic national brand, Proton epitomises the spirit of Malaysia".

"Our support for Proton, our guidance, and the conditions we set, have now led to Geely becoming a 49.9 per cent shareholder, so that going forward, Proton will have the ability and resources to turn itself around and become an example of Malaysian success, without needing handouts from the government", he added.

"Geely will also develop future models with Proton, bringing in the latest technology and research and development (R&D) programmes, and will be assembling Volvo cars if there is any excess capacity in the Tanjung Malim plant", he said at a press conference after the signing of the definitive agreement here today.


"Our partnership will enable Proton to become the industry leader in Malaysia and a top three brand in Southeast Asia".

DRB-HICOM will retain 50.1 percent stake in Proton.

Li Shufu was not able to provide a timeline for Proton's return to profitability when asked, but said that Geely would want the company to be back in the black as soon as possible.

In China, the world's largest automotive market where some 20 million cars are sold annually, Geely is the seventh-biggest player, with 766,000 cars sold in 2016. "We will work together to make the most of our respective strengths". For Proton, we hope that we can help it regain market share in Malaysia, and also expand into ASEAN markets.

Yet Geely still has a long way to go on Proton, even if it has successfully managed to revive Volvo, the Swedish auto brand it acquired in 2010. "He would still prefer Proton to be 100 per cent Malaysian-owned and lose hundreds of millions of ringgit a year", Datuk Seri Najib said, without explicitly naming anyone.

"We believe it will not take a long time because we have strong confidence in the growth of the Malaysian automotive market, and also in Proton", he said.

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