DRB-HICOM Berhad (DRB-HICOM) has reached an agreement with China-based Zhejiang Geely Holding Group Co., Ltd (Geely Holding) for the Chinese car group to acquire a 49.9 percent equity in Proton Holdings Berhad. DRB-HICOM currently owns 100 percent of Proton. The two parties signed the agreement in Putrajaya, Malaysia today, witnessed by YB Datuk Seri Johari Abdul Ghani, the Minister of Finance II.

The deal will enable Proton to tap into Geely Holding's vast range of platforms and powertrains, and will also enable Proton to have access to existing markets of the Chinese carmaker, as well as right-hand drive markets in South East Asia. DRB-HICOM Group Managing Director, Dato' Sri Syed Faisal Albar says the Proton brand will remain present and will grow significantly with the new foreign strategic partner on-board.

The deal will also see Proton sell its entire equity in British carmaker Lotus to Geely Holding, which will see the Group exit the sports car segment. Geely Holding, which also owns Volvo Car Corporation and The London Taxi Company, is one of the leading passenger vehicle carmakers in China. The deal with Proton will offer Geely access into the key ASEAN market, and boost its R&D and manufacturing presence in the region. Both parties are expected to sign the Definitive Agreement in July 2017.