Here’s a little update on the Proton-Volkswagen tie-up talks. Thomson Financial cites a report by German newspaper Wolfsburger Allgemeine Zeitung regarding the deal and it is revealed that Volkswagen AG may take a 20% stake in Proton, and a final decision will be made no sooner than a supervisory board meeting in February. This is roughly two months after the Malaysian government’s self-imposed deadline of the end of 2007 for a tie-up deal to be decided.
Not much details about this 20% deal is known, like 20% of the entire of Proton or a certain division/divisions for instance, but it has been learned that Volkswagen wants Malaysia to cover Proton’s losses for the next 3 to 5 years. The report also states that Volkswagen plans to increase the stake to more than 50% in several steps in the future.