Now that the Proton-Geely deal has been confirmed, DRB-Hicom took some time after the signing ceremony to explain the bidding process involved in the selection of a foreign strategic partner (FSP) for the national carmaker.
According to the corporation, plans for a FSP were part of its proposal to acquire Proton in 2011 (formal bid in 2012), in line with its transformation plan for the brand. In fact, news on the matter have been in existence as far back as 2012, followed later on by Proton’s announcement to work with Suzuki and Honda on specific projects (not permanent partners).
Even though DRB-Hicom was looking for a FSP for the national carmaker, it reiterated that it would continue to hold a substantial stake in the company. It then held an open bidding tender for Proton, and between May-June 2016, 23 automotive groups submitted their interest, with 15 candidates later being invited to submit a request for proposal (RFP) between July-August 2016.
That number was further reduced from eight to five candidates after studying the respective RFP submissions, which was followed by site visits between the parties to better evaluate the in-house technology available. It was at this point that DRB-Hicom analysed the candidates’ suitability (or fit) for Proton, based on three criteria – strategic, operational and cultural.
The first, strategic, focused on the technologies or tangible benefits the carmaker could gain from a partnership, be it with platforms or powertrains. The second (operations), focused on management and corporate structure, while the third (cultural) dealt with sharing a similar vision and mission, aspirations as well as chemistry (as you would need to do before marriage).
It was also at this stage that DRB-Hicom required the candidates to commit to four go/no-go conditions. This included a willingness for the parties involved to share their technologies with Proton, ensuring brand continuity, the capacity to inject capital as well as providing opportunities for Proton to be a global exporting hub.
After this particularly demanding vetting stage, the five were shortlisted to just three candidates, at which point due diligence was performed to further evaluate the effectiveness of each remaining candidate to meet Proton’s aspirations. All this culminated in the final selection of Zhejiang Geely as the FSP, which was announced on May 24, 2017, with a definitive agreement to be signed later in July.
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So looks like not just the highest bidder wins. Kudos to P1 mgmt, DRB hicom mgmt, gov and all bidding parties for taking a more holistic approach to the takeover. At least the bidding parties have their roadmaps to chart the companys future.
This unlike US style mergers where they take all the benefits and leave an empty shell of a company.
First thing Geely must do for Proton:
Sack the designer!!!
Generally P1 have quite sound designs bar some like savvy, waja & Perdana2. Other than that, Persona2 is constraint by the platform its based, but still better looking than Biza.
Kudos to DRB hicom mgmt, they took Shah Alam lands and Lotus. Left Proton in RM3Bil bailout mess.
Or sack the CEO. Why still asking billions from the Gov?
Agreed. Look at the small and flat preve headlights with bulky and raised too high rear end and overly designed perdana.
Janji Geely > all
Tongsan is coming, mafakaaa
Just like in android smartphone scene, the Chinese Xiaomi, Huawei, OPPO, came and disrupted the market so badly, Samsung was forced to up their ante, while the rest struggles to fend off the Chinese eg LG, HTC, Sony, Motorola, etc.
While previous efforts had a lot of hiccups eg Chery Eastar, Great Wall/Haval, they’re learning and not giving up. There’s no doubting they will get that big break they seek for. With this “partnership”, the local automotive landscape is about to experience the biggest shake up it will ever have.
This is truly an exciting time to be in.
Amboiiii. During discussion, main hentam P1 habih habih. Now dah beli, sokong kau kau. Hyppo much?
I’m consistent. I’ve always said Volvo > all, and anything associated with them.
Now finally Proton has confirmed to join the family, Proton is welcomed as well.
Volvo > all
Geely > all
Lynk & co > all
Proton > all
Why is the Chinese helping Proton to repay loan due to their own incompetency?
Becoz they can and want to? Takbleh bayar balik loan tu ke, so that u can continue ur bashings? Too bad.
Because it’s a worthy investment for their goal to be in ASEAN market?
If it’s Proton’s fault then Proton CEO shud repay the loan, not third party
Ehhh. Not feeling it. Those are tech companies. If it’s Tesla acquiring proton then I get feel what you mean. Else, this is just another takeover ? Both mediocre brands…
I’m talking about the rise of Chinese cars that will disrupt the status quo. It happened in smartphone industry, it will happen in car industry, we’ve heard it years ago in Top Gear, it will happen.
Hah, u underestimate the might of Geely and co. You’ll be proven wrong anyway, so no need to trouble myself correcting you.
No need to be a rocket saintis to know it. Geli just want Lotus.
You have lost RM5 bil in the past 12 months. You are selling crap to consumers and downright have zero respect for the Malaysian car-buying public – preferring to continue pushing junk at inflated prices to the public who are unable, in most cases, to afford anything else due to high protectionist import duties. And you have the audacity to publish high-level fancy slides justifying the surrender of 50% equity in a deal that no one cares about to a buyer who only wants Lotus. What is the price they paid? Pretty sure its zero. You lose RM 5 bil and yet have the time to throw press conference and spend probably millions hiring a consultant to make these nonsense slides. Get out Proton, no one cares.
Yes, Ollie. No one cares for the 10,000 employees and thus 40,000 stakeholders in the immediate vicinity.
PROTON may have done many things wrong in respect of vendor management and product life cycle – thanks to Tun M’s so-called vision – but DRB-HICOM should be commended for securing the 0.1% majority.
Looking at their experience with Volvo, London Taxi Co and now Saxo Bank, they look serious in their internal quest to be a huge carmaker and they realise too, just because China is packed with people, there is a market out there for a proper quality China-made car in the rest of the world. Chairman Li Shu Fu is a genuius!
Not sure what’s a guinius.
South east Asia is a 3mil car per annum market work potential to grow to 10 mil cars. Malaysia is the best strategic manufacturing hub to serve the whole of the region. In the past 30 years, we have forgone 30,000 manufacturing jobs and 300,000 auxiliary employment to satisfy the mad dictator and prop up this loser carmaker. It’s not this that is sad. It’s the ignorant Malaysians who defend proton that is sad.
Chinamen are generally good businessmen, but you’re forgetting the rules of playing in holy land. I wonder how much authority they actually have in hand. Will they be allowed to filter vendors? Or trim workforce etc.
I’m not a fan of Proton cars but I don’t really hate the car at all. It’s the people that were doing the after sales services which are causing headache for owners.
OMG. P1 just confess that when they were looking for FSP to be permanent partner, they slept with Su-Su-Ki & Horn-Dah in 2012. Not satisfied with their performance & services rendered, they started courting again.
The best part is P1 then open up to the world as if they were looking for the best partner not knowing they look haggard & sagging.
Fret Not, due to modern technologies, P1 use tax payers $$$ to Massage their body to hide the “Figures”(many Zeros) to make themselves look GUD/beautiful.
Now that they managed to get a rich Godfather from China to take most if not all of the “Liabilities”, they are so proud to tell the world & come out with a Chronologies of how they flirted & planned their Success story. Hehehe. Cheers …
Haha don’t believe 90% of this story. This is like a poor ugly spinster saying she chose from 10 different eager suitors before finalising one from a top 3 selection for marriage.
Yet that spinster tha u spurned managed to marry a rich towkay. Whos at loss here?
DRB Hicom.
You are still arrogant, want to have a controlling stake etc etc. then no need go to govt and beg for loan lah. Sendiri cari sukuk loan or get from your shareholders via rights issue lah.
Why still wanna have 50.1% stake when u don’t have the money to sustain the business?
After losing billions still hoping that u can revive the P1 branding?
Time to take a step back and give the new stakeholder leeway to determine the future of P1.
Not arrogant at all. It’s just part of the plan. Just as long as crony keep Proton afloat, they can keep the taxation system in place in the name of protecting the national car maker. If it’s being sold entirely, then there will be no more national car agenda and Malaysian and fellow oppositions will push for lower taxation.
The white elephant in the room is EV. When tesla can use the Lotus platform to become the largest automotive manufacturer by market cap 10 years ago, it wonders what P1 mgmt has been doing all this while.