Nov 19 2006
According to business news from Reuters which picked-up a report from Business Times, France’s PSA Peugeot Citroen is expected to present its bid for Malaysian carmaker Proton Holdings next week.It was reported that Peugeot executives would brief senior officials from the finance ministry, Proton and state investment arm Khazanah Nasional, which owns 43 percent of Proton, in Kuala Lumpur on their bid.
PSA is believed to have brought forward the briefing, after news broke out that Volkswagen AG, Europe’s biggest carmaker, was interested in taking a 51 per cent stake in Proton’s manufacturing arm, in a deal valued at about RM2 billion.Government and Proton officials could not immediately be reached for comment.
Second Finance Minister Nor Mohamed said last week the government was talking to many potential partners, including PSA and Volkswagen, over the sale of a stake in Proton, adding a decision on the sale could be made by February.
Malaysian integrated automotive firm DRB-HICOM said on Tuesday it was interested in taking a stake in Proton.
In September, Proton and PSA signed a letter of intent to study possible cooperation between the two auto manufacturers.
The pact, which expires on Jan. 1, 2007, will focus on areas including product development, manufacturing, quality initiatives, vendor development, contract assembly and distribution.
Proton, long a beneficiary of state protection, is losing market share and struggling to boost exports in the face of increased South Korean and Japanese competition – a situation that analysts say can be solved by striking a global industry partnership.
The government has been reluctant to relinquish a majority share in Proton, which was launched in 1985 by then Prime Minister Mahathir Mohamad to help boost the wealth of ethnic Malays by finding them a niche in the auto sector.
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November 19th, 2006 by financetwitter
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