Malaysia’s state-owned Khazanah Nasional is looking to sell its 42.7% stake in Proton Holdings to DRB-Hicom, a diversified local industrial company with a growing automotive portfolio, according to local reports.
Khazanah is understood to be no longer prepared to fund its share of the expansion of Proton Holdings, including its UK sports car subsidiary Lotus Group, which has become a major drain on resources for Malaysia’s first national car company.
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DRB-Hicom is a significant automotive player in Malaysia, assembling and distributing vehicles for Honda, Isuzu and Suzuki. In November, it began assembling Volkswagens following a broad-based agreement with the German automaker.
Local reports have suggested that Khazanah approached other local automotive groups about the sale of its stake in Proton including Sime Darby Motors, the Naza Group, Hyundai-Berjaya and UMW Holdings, but DRB-Hicom was the only company interested.
Lotus Group is proving to be a significant cash drain and few local companies have the resources or are prepared to take on such a challenge.
