Is Proton Deal A Win-Win?

The fortunes of Malaysian carmaker Proton could finally be about to change as local conglomerate DRB-Hicom has agreed to buy a controlling interest in a MYR1.29bn (US$410mn) deal. While the acquisition could signal the end of Proton's long search for a new strategic partner since Mitsubishi Motors sold its stake in 2004, it should also help DRB-Hicom in terms of global expansion, making it more of a mutually beneficial deal than it may first appear. Nevertheless, CFW notes considerable risks being undertaken by DRB-Hicom, not least Proton's growing debt pile.

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