Lotus-Parent Proton Sold to Private Conglomerate DRB-Hicom
In a deal eclipsing $410 million, DRB-Hicom purchased a 43 percent stake in Proton, a Malaysian automaker better known for its ownership of the famous British sports car brand, Lotus.
Originally, the stake belonged to Malaysia’s state-owned Khazanah Nasional Bhd. However, as Proton has not made a profit in the last two years, multiple prospective buyers stepped in for acquisition talks before the controlling stake was finally approved for DRB-Hicom, a large conglomerate with a hand in automotive services, transport, and power generation.
This investment effectively hands DRB-Hicom the control of two Malaysian car plants that are capable of producing a combined 350,000 vehicles a year. This production number may increase in the future as General Motors just reached out to Proton last month about a possible manufacturing joint venture in Malaysia so that GM could gain better access into the Southeast Asian market. The talks are not yet complete and it will be interesting to see what effects DRB-Hicom will have in the discussions.
What’s more, DRB-Hicom is also the new private owner of Lotus. Unfortunately, this change puts the future of Lotus into question. Lotus has not been able to make a profit for Proton since 1996, an equities investor suggested that all or part of Lotus would likely be sold. Among those interested in Lotus is Genii Capital, a part owner of Lotus Renault GP.
[Source: Bloomberg]
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