A Malaysian car-maker has approached the country's biggest auto firm, Proton Holdings Bhd, to buy Proton's controlling stake in British sports-car subsidiary, Lotus, the Malaysian Reserve said on Thursday.

Proton bought 63.75 percent of Lotus in 1996 for 40.64 million pounds ($81 million), the daily said. Lotus make sports cars and also runs an auto engineering consultancy.

The approach followed the collapse last month of a proposed alliance between Proton, a struggling state-controlled firm, and Germany's Volkswagen. Proton shares have lost a quarter of their value since the talks broke down.

"It is believed the interested party™expressed a desire for the controlling stake in the high-performance engine manufacturer after the failure of Proton-Volkswagen partnership talks late this year," the Malaysian Reserve said, quoting unnamed sources.


The financial daily did not name the bidder nor give an offer price.

Proton shares last traded at 3.70 ringgit each.