According to a recent Bloomberg report, the Malaysian government-owned Proton Holdings Bhd may sell its stake in Lotus Group International.Lotus has been in the hands of Malaysia’s state-owned Proton since 1996 and during that time has yet to turn a profit.State-owned Khazanah Nasional Bhd., which owns a 43 percent stake in Proton, has confirmed that it has received offers for its share in Proton and speculation that a sale may be coming has seen the stock price rise nearly 50 percent this month.If Proton were to land in private hands, it’s almost certain that all or part of the Lotus group will be sold.Read the full news by Paul Lienert from Insideline below.
PROTON URGED TO SELL LOTUS
KUALA LUMPUR, Malaysia — Asian investors are urging Malaysia’s state-controlled Proton to sell money-losing Group Lotus. Among the prospective purchasers, according to local media reports, is China’s Shanghai Auto, which owns MG Rover.
Proton, which was established in 1983 as Malaysia’s “national car company,” bought Lotus in 1996 and “has yet to make a profit” on the tiny British sports-car and engineering firm, according to the U.K.’s Daily Mail. The losses are “likely to continue to at least 2014,” the paper added.
Proton itself is in the early stages of separating from government control. A majority interest is expected to be sold in the coming year to one of Malaysia’s larger conglomerates, possibly local automaker DRB-Hicom.
Meanwhile, Proton investors are becoming more vocal in calling for the sale of Lotus, which previously was owned by Italian industrialist Romano Artioli, who purchased the company from General Motors in 1993 and once envisioned Lotus as the perfect fit for his resurrected Bugatti (control of which subsequently shifted to Volkswagen).
In an interview with Bloomberg, Lotus CEO Dany Bahar said he was confident that Lotus could turn a profit by 2014: “The only thing we can do is show the current owners, or the new owners, that we are absolutely in line with the business plan that we have presented. Without the funding support and the guarantees given by the Proton group, we would not survive, end of story.”
Bloomberg quoted one Malaysian investor in Proton as saying, “Proton and Lotus are not a good fit. They are in different market segments, both in terms of geography and product.”
A Malaysian investment analyst added, “Proton is better off without Lotus. There are no product synergies.”
Asian investors are urging Malaysia’s state-controlled Proton to sell money-losing Group Lotus.
Proton bought Lotus in 1996 and “has yet to make a profit,” according to the Daily Mail.
Among the prospective purchasers of Lotus is China’s Shanghai Auto, which owns MG Rover.