Geely Renault Bid for Proton Enterprises Have Conducted Due Diligence

Recently, news that Geely bid for Malaysia automakers Proton Automobile’s share has raised much discussion, the share price of the parent company DRB-HICOM group also has risen for a time . At the same time, Peugeot Citroen group (PSA) and Renault also are involved in the bid, but up to now, three enterprises have not publicly acknowledged of the bid.

As the earliest state-owned auto enterprise set up in Malaysia, the market performance of Proton in recent years is not satisfactory, but it has been a sign of Southeast Asia car brand. From the latest case of DRB HICOM group, enterprises with bid intention have completed the early stage of the due diligence investigation of Proton cars, in the first half of this year or in a shorter period of time the final result will be announced.

Due Diligence is in Progress by Enterprises with Bid Intention

On February 8th this year, DRB-HICOM group made a statement that the group are actively looking for a new proton's "foreign strategic partner". In the past few weeks, enterprises with bid intention have carried out due diligence on the Proton car, while the latter is waiting for the bidding.

In addition to Geely, Peugeot Citroen group (PSA) and Reynolds group are overwhelmed by speculation that has the intention of bidding. 

Continuous Decline of the Local Market Share of Proton

DRB-HICOM group released an official statement and said the foreign strategic partners for Proton have to meet with three aspects: strategy, operation and culture. It also mentioned that strategic cooperation will enable both sides to achieve a win-win situation, and keep the Proton's brand, and help Proton to achieve economies of scale in the local market.

Proton car successively had 4 foreign partners, although it had been successful, in recent years the trend has not been reversed. Therefore, the industry has a point of view that whichever company bid successfully, the follow-up cooperation is the biggest problem.