Malaysia Says Only Talking To VW, Peugeot on Proton

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Nov 20 2006
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Latest financial news from Reuters indicated Malaysia is talking only to France’s PSA Peugeot Citroen and Germany’s Volkswagen on a possible collaboration with state automaker Proton Holdings, a government minister said on Monday.

Second Finance Minister Nor Mohamed Yakcop did not give details of the talks, but they follow statements he made on Nov. 10, that the government was talking to many potential partners, including Peugeot and Volkswagen, over a Proton stake sale.

Proton, long state-protected due to affirmative action policies aimed at giving the country’s ethnic Malays business and employment, is fast losing market share and struggling to boost exports in the face of South Korean and Japanese rivals — which analysts say can be solved by striking a partnership with a global player.

“We are engaging both Peugeot and Volkswagen in this exercise,” Nor Mohamed told reporters, adding that he had met officials from French carmaker Peugeot, but no date had been set for the next round of discussions.

“There is an interest to collaborate and to work together,” Nor Mohamed said.

The statements dampen speculation that there could be other immediate offers from other foreign carmakers. They also pour cold water on reports in the local media that Peugeot could present its bid for Proton this week.

“We are talking to make sure that whatever we implement is in the interests of Proton particularly and of course, the interests of the nation.”

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