Malaysia To Decide On Proton Partner In Three Months, Vw Talks End

[Mark H]

http://www.autoindustry.co.uk/news/01-06-07_5

 

The Malaysian government has set a new deadline to name a foreign partner for Proton Holdings Bhd within the next three months after Volkswagen AG backed out from becoming an equity partner for the ‘national car maker’ and Lotus Group parent.

 

Second Finance Minister Tan Sri Nor Mohamed Yakcop said today the government would want to resolve problems in Proton before proceeding with its ‘Plan B’ to find a foreign suitor for Proton. "We will decide on the partner for Proton within the next three months," he said, though he declined to comment on whether the government had engaged in talks with any prospective Proton partners. The government had already missed its self-imposed March 31 deadline to name the strategic partner for Proton.

 

Khazanah Nasional Bhd, the Malaysian government investment arm, owns around 43% of Proton.

 

Asked whether Volkswagen's intention to have a controlling stake in Proton was the reason for its pullout, he said: "It's not a major issue. Nothing has failed because of that reason."

 

Malaysian Prime Minister Datuk Seri Abdullah Ahmad Badawi said yesterday that Volkswagen AG was not keen on Proton's proposal in terms of equity participation but would rather engage in some other form of cooperation.

 

Proton incurred a full-year pre-tax loss of RM619.9 million for its financial year ended March 31, 2007. Commenting on Proton's results, Nor Mohamed said there would be no bailout for the company.

 

(Bernama national news agency, 1 June)