It’s now official; DRB-Hicom has reached an agreement with Zhejiang Geely for the Chinese carmaker to acquire a 49.9% equity stake in Proton.

The deal, which is subject to regulatory and shareholder approval, will also see Geely acquire a majority stake (51%) of Lotus from Proton. DRB-Hicom also announced that it will be selling off the remainder of its 49% stake in Lotus, exiting the sports car business.

Both parties expect to sign the definitive agreement before the end of July 2017. Geely also notes the agreement will allow it and Proton (along with its Lotus subsidiary) to “explore joint synergies in areas such as R&D, manufacturing and market presence.”

The Chinese carmaker says it is “committed to supporting the transformation of Proton and Lotus” with its expertise, and aims to “build Proton into the most competitive brand in Malaysia and a leading brand in Southeast Asia.”

“Our intention was always to ensure the revitalisation of the Proton nameplate. It was Malaysia’s first national car brand and has more than 30 years of history. This deal will be the catalyst to elevate a brand that Malaysians resonate with,” said DRB-Hicom group managing director, Datuk Sri Syed Faisal Albar.

Meanwhile, Geely group executive vice president and CFO Daniel Donghui Li commented: “With Proton and Lotus joining the Geely Group portfolio of brands, we strengthen our global foot print and develop a beachhead in South East Asia.”

“Geely Holding is full of confidence for the future of Proton, we will fully respect the brands history and culture to restore Proton to its former glory with the support of Geely’s innovative technology and management resources. We also aim to unleash the full potential of Lotus Cars and bring it into a new phase of development, thanks to our experience accumulated through Volvo Car’s revitalization,” he added.

The search for a foreign strategic partner commenced as part of the conditions of the government’s RM1.5 billion soft loan to the national carmaker, which was approved in April last year. Among those also rumoured to be in the running were Renault and Suzuki – the latter had signed a collaboration with Proton in 2015, which resulted in the production of the Proton Ertiga.