Lotus eyes up Chinese takeaway
Volvo's owner closes in on British sportscar-maker in deal that could see it own Proton tooChinese car-making giant Zhejiang Geely Holding Group has entered into the final round of bidding for both Lotus and its owner Proton, it has been reported.
According to two sources speaking to newswire Reuters, the deal to buy the British sportscar-maker and Proton will be far from straightforward.
Instead of a strict cash offer, Geely will offer Proton's parent company, HRB-Hicom, some of its latest vehicle technology that has been developed with Volvo.
As part of the dealings the minimum share purchase Geely will consider is a 51 per cent stake in Proton, say the sources.
If that's not possible, Geely will split Lotus and Proton and renegotiate for just the British car-maker.
The beginning of the formal bidding procedure is claimed to have already begun, with a formal bid for the Norfolk-based car-maker expected to happen early this week.
The sale is said to have been triggered by DRB-Hicom, which earlier this month invited interested parties to begin submitting bids for a "strategic partnership".
Last year Proton received $US338 million ($A440 million) in state aid from the Malaysian government in an attempt to turn it around and make the car-maker more attractive for investment.
According to the newswire, the PSA Group (Peugeot/Citroen), Suzuki and Renault are all expected to make a bid for Proton, but not Lotus, paving the way for Geely to pocket the British brand whatever the outcome.
Both Geely and DRB-Hicom have declined to comment on whether or not it had entered negotiations.
Geely hopes, once it's purchased Proton, that its technology will help the low-cost Malaysian car-maker compete on a more equal-footing against rivals in its right-hand drive markets that include Malaysia, the UK, India and Australia.
It's thought Geely wants Lotus because of its chassis-tuning expertise and new technology division, but not it's profit-making potential. The British car-maker has only just returned to the black after two decades of losing money.
A similar acquisition of Chinese brands GC9 and Boyue SUV, which included platform sharing and the use of Volvo tech, has already reaped rewards for Geely.
According to Automotive News, last year both GC9 and Boyue SUV helped the Chinese car-maker increase sales in China by 50 per cent to 765,851.
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