English

04 June 2017

VOICE OF MSWG

The sale of a 49.9% share in our national carmaker Proton has been a long time coming, after numerous attempts by first Khazanah Nasional, the government, then DRB-HICOM (DRB), to dispose the stake.

But unlike that adage of ‘saving the best ‘til last,’ this sale to Geely of China should be examined for its impact on taxpayers, DRB shareholders alike and the vendors and any other DRB stakeholders.

In real cash terms, only RM170 million goes to DRB for their nearly half stake in Proton, much less than the RM558-odd million that it receives for its sale of 100% of the much-smaller Lotus in a parallel transaction. Not a lot, in other words, for a car company that was once the market leader in Malaysia and which counts over three decades of operations.

Under the terms, the DRB-Geely Proton JV also receives rights over the use of Geely’s Boyue SUV in Malaysia and the region, but this is an existing (though albeit successful) platform that requires no extra monetary investment from the Chinese. Its impact, however, on the Malaysian vendors may be crucial.