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Malaysian Automaker Proton Sold; Is Lotus Next?

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On: Wed, Jan 18, 2012 at 3:47PM | By: Chris Weiss


Malaysian Automaker Proton Sold; Is Lotus Next?

In a move that's been rumored for several months, Malaysia's state-owned Khazanah Nasional Bhd sold its 43 percent stake in Malaysian automaker Proton. While Proton may not be a relevant or familiar name to the US auto market, one of its holdings--Lotus--is. Lotus' future remains in question with Proton's sale.

According to Bloomberg, DRB-Hicom Bhd paid the equivalent of $410 million for the 43-percent stake, which comprises 234.7 shares. DRB is an automotive assembly and distribution company that works with prominent global brands like Mercedes and Volkswagen. The company is owned by Syed Mokhtar, one of Southeast Asia's youngest billionaires.

The sale brings a new emphasis on questions surrounding Lotus' future. Lotus has been under Proton ownership since 1996, during which time it has not turned a profit. A Bloomberg report earlier this month said that many investors were getting antsy, believing that Proton should sell Lotus.

Besides the fact that Lotus has been unprofitable, some investors feel like the two companies are a mismatch. Proton builds some of Malaysia's cheapest cars while Lotus builds lightweight sports cars and supercars.

However, Lotus is on the brink of a multi-product launch that executives say will bring it to profitability by 2014. Without investment from a parent company like Proton, Lotus' future could be grim.

Lotus CEO Dany Behar told the media last month, "Without the funding support and the guarantees given by the Proton group, we would not survive, end of story."




Comments

reply

Stephy21 | 9:46AM (Thu, Jan 19, 2012)

I have never really heard of Lotus before or ever seen their cars unfortunately but maybe if they sell the company it can make some one money.


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Sami18 | 10:00AM (Thu, Jan 19, 2012)

I think this will be a good thing for the company if they sell it. Since they haven't made a profit since 1996.



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