Proton's Majority Stake Will Be Sold To DRB-Hicom, Says Dr Mahathir

Proton is landing in the hands of DRB-Hicom, if Tun Dr Mahathir Mohamad, former Prime Minister and current Proton advisor, is to be believed. Despite the official denials of all parties involved including Khazanah Nasional, the present owner of 42.7 percent in the national automaker, Dr Mahathir decided to jump the gun and confirm to the media that Proton has found a new owner in DRB-Hicom, which beat out competition like the Naza Group, Sime Darby Motors, Hyundai-Berjaya and UMW Holdings.

Dr Mahathir further revealed that Khazanah was keen on a sale because it was reluctant to invest more in Proton, which needs additional funds to develop new models, delve deeper into hybrid technologies and restructure its sports car subsidiary, Lotus. Our ex-Prime Minister was also confident that Proton would proudly remain a national car brand after its sale, dismissing talks that DRB-Hicom would divest a controlling stake in Proton to Volkswagen after the conclusion of this deal.

Amid the media buzz and rife speculation of a change of ownership, Proton's share price has risen, indicating that market players are betting on the chance of this rumour materialising in the near future. Reports say that Khazanah Nasional could be ready with a decision by the end of this month, so we can differentiate fact versus fiction soon enough. More important, of course, is whether Proton will get a boost in funds and a revision in management to alter the course the company is on and its future model lineup.