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Volvo Owner Buys Out Lotus
Chinese automotive company Geely has purchased stakes in Malaysia's Proton. The deal will be signed in July 2017.
The Chinese owner of Volvo Cars, Geely agreed to purchase 49.9 percent of Malaysian car manufacturer Proton. With the deal, Geely will expand its reach to Southeast Asia.
The deal also gives Geely a distribution network in Southeast Asia where non-Japanese vehicles have struggled. Proton also gets a stable partner with more advanced technology.
Geely Holding Group Co. Ltd. will purchase 51 percent of British automaker Lotus from Proton. The deal is estimated to be 66.2 million dollars. The Malaysian automaker is selling the stakes in Lotus to cut losses.
The remaining 49 percent is acquired by Etika Automobile owned by Syed Mokhtar Al-Bukhary. He also holds controlling stake in Proton's parent firm, DRB-Hicom.
Geely Executive Vice President, Daniel Li Donghui said, "With Proton and Lotus joining the Geely Group portfolio of brands we strengthen our global footprint and develop a beachhead in Southeast Asia."
Geely aims to bring back the glory of Proton with the help of its innovative technology and management resources. Li stated that Geely's aim is for Proton to manufacture 5,00,000 cars by 2020.
Proton will also assemble Volvo cars and plans to launch Geely's SUV in the Malaysian market. The employees of the Proton will not be affected by this deal. A final agreement will be signed in July 2017.
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