ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintTitle ChevronIcon Twitter
Proton showroom at the company's head office
Business

China's Geely acquires 49.9% of Malaysia's Proton

Chinese automaker gets beachhead in Southeast Asia, stake in Lotus

CK TAN, Nikkei staff writer | China

KUALA LUMPUR -- DRB-Hicom said Wednesday it will sell a 49.9% stake in Proton Holdings, its fully owned automaker, to China's Zhejiang Geely Holding Group. In the deal, Geely also gets Proton's 51% stake in Lotus, the British sports car maker.

The announcement came after the Malaysian automotive conglomerate spent nearly a year searching for a foreign partner to help it turn around Proton. For, Geely, which also owns Sweden's Volvo Cars, the deal will help it foray into Southeast Asian markets.

DRB and Geely expect to sign an agreement by the end of July. The two companies are seeking synergies in manufacturing, research and development and other areas. They did not disclose how much Geely will pay for the stake.

Donghui Li, Geely's executive vice president and chief financial officer, said in a press release that with Proton and Lotus joining the group, the Chinese company aims to "strengthen our global footprint and develop a beachhead in Southeast Asia."

Currently, Proton gets the majority of its sales in Malaysia. Last year, it sold some 72,000 units in the country. Across the border in Thailand, it sold fewer than 150 units. In Indonesia, it sold fewer than 50.

Even in its home market, the Malaysian brand has been struggling for years; its market share eroded from over 70% in 1993 to 12.5% in 2016. 

In a report on Wednesday, Malaysia's AmInvestment Bank pointed out that "sales of Proton's passenger cars continued to tumble to 4,700 units in April, the lowest since August last year." 

Geely's Li added that the company will "restore Proton to its former glory with the support of Geely's innovative technology and management resources."

DRB said in a press release that the Proton brand will remain.

Proton has been left without a foreign partner since 2005, when Japan's Mitsubishi Corp. sold its stake.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Try 1 month for $0.99

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends October 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to Nikkei Asia has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more