SHAH ALAM, Jan 18 — DRB Hicom said today that it is open to selling British sports car icon Lotus in a bid to help put Proton on firmer footing.
DRB Hicom Group Managing Director Datuk Seri Mohd Khamil Jamil said in a press conference today that he would consider all options including the sale of Lotus which is in the midst of a costly turnaround plan.
Lotus is wholly owned by Proton and is currently in the midst of a five-year turnaround plan which could see the company continue to incur losses for the next one to two years.
In November last year, Proton reported that its second quarter net profit had slumped by 76 per cent to RM15.56 million from RM65.92 million in the same period in 2010 due to higher spending on Lotus.
But the carmaker had maintained that Lotus remained on target in the second year of its five-year turnaround plan, including the successful unveiling of the Exige S, Elise S and the Evora GTE road car at the Frankfurt Motor Show, as well as the launch of the improved Evora MY12.
It also had to deny rumours raised in a British autoracing magazine that it planned to sell a stake in Lotus to European investors, and issued an assurance that it remained committed to getting the loss-making unit back into the black.
British motoring magazine Autosport UK had reported last October that Proton was poised to sell a stake in Group Lotus to Genii Capital, a private investment firm based in Luxembourg.
Proton first acquired a majority stake in Lotus in 1996 to take advantage of the latter’s technical expertise, before securing full ownership in 2003.
State asset manager Khazanah sold its 42.7 per cent stake in Proton to DRB Hicom on Monday for RM1.29 billion as part of its divestment strategy.
Khamil Jamil said that 85 per cent of the funding will be from Maybank while 15 per cent will be from internally generated funds.
The diversified group, which is owned by tycoon Tan Sri Syed Mokhtar Al-Bukhary, will now have to make a mandatory general offer (MGO) for all remaining shares of Proton and Khamil said the funding for the MGO will be from a mix of internal funds and bank borrowings.
