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[KUALA LUMPUR] The parent of Malaysia's Proton said Friday that Chinese auto giant Geely will inject US$40 million and an SUV product into the lossmaking carmaker, as it looks to access a South-east Asian market dominated by Japanese automakers.
DRB-Hicom group managing director Syed Faisal Albar said Geely will invest 170.3 million ringgit (S$55.1 million) cash and its SUV Boyue platform worth 290 million ringgit for the 49.9 per cent stake in Proton it agreed to buy in May.
Geely will also pay Proton £51 million (S$90 million) for a 51 per cent stake in British sports-car maker Lotus, he said.
"With Zhejiang Geely Holding Group on board, Proton can now eye the huge Southeast Asian passenger car market with renewed confidence," he said at the signing ceremony of the deal, which was attended by Malaysian Prime Minister Najib Razak and Zhejiang Geely Holding Group chairman Li Shufu.
Mr Najib hailed the merger, saying it will end "handouts from the government" for troubled Proton.
Proton was formed in 1983 as part of an ambitious national industrialisation plan, but has suffered from a reputation for unimaginative models.
Meanwhile, Geely's Mr Li said it will help Proton gain inroads into South-east Asia and would consider producing Lotus in China.
"If there is a possibility, we will review our business plan," he told reporters when asked if Geely will consider such a move.