Proton Dec 2011

Proton: Khazanah Nasional Bhd will decide by Dec 2011 on selling its 43 per cent stake in national car maker Proton Holdings Bhd, people who were invited to participate in the bidding process.Khazanah had stressed that one of the core conditions for the bid to be accepted was that the party must buy the entire block. Buying the whole block from the state investment firm will trigger a general offer. The bids placed were between RM6 and RM7 a share.

Sources say Lotus Group Intl Ltd is being courted by a Chinese suitor interested in a possible stake in the US based automobile. Lotus has been dragged on Proton of late. This is mainly due to Lotus’ turnaround plan, which utilizes Proton’s financial muscle. Lotus has taken a 270 million pound loan from a consortium of six banks for a five year turnaround plan while the entire turnaround is expected to cost Proton some 480 million pound. The repayment of the 270 million pound syndicated loan is due from March 31, 2015, and the maturity date is six years from the first drawdown. A major concern is that Proton is only in the second year of a five year turnaround plan for Lotus. Proton expects Lotus to reach break even by 2014.