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Geely finalizes Proton board structure and completes Lotus transaction

KUALA LUMPUR – In separate announcements, Geely said on September 29 that it has finalized the board structures and part of the executive team for Proton Holdings Berhad and its related companies (Proton Group) as well as completed the transaction to purchase a majority stake in the British luxury sports brand Lotus.

The announcements come exactly 100 days after the signing of the Definitive Agreement between Malaysia’s DRB-HICOM Berhad and Geely on June 23 over the acquisition of Proton and Lotus brands.

Geely has appointed industry veteran Dr. Li Chunrong as the new CEO of Perusahaan Otomobil Nasional Sdn Bhd (PONSB). Li, who has spent 30 years in the industry holding numerous senior executive roles at Dongfeng Motor Group’s subsidiaries including Dongfeng-Yueda-Kia, Dongfeng Passenger Vehicle and Dongfeng-Honda Engine, will lead a new executive team of global experts with a task to revitalize Proton Group. Winfried Vahland, former chairman and CEO of Škoda Auto and former president and CEO of Volkswagen Group China, was appointed an independent board member.

Dr. Li will be responsible for the whole operations of Proton, involving production, manufacturing, operations, marketing, quality, R&D and sales & marketing. Current deputy CEO, Datuk Radzaif Mohammed, will support Dr. Li.

At the PROTON Holdings Berhad (PHB) level, Dato’ Sri Syed Faisal Albar remains as the chairman, and he is joined on the board by Shaharul Farez Hassan and Amalanathan Thomas as nominees from DRB-HICOM. Farez and Nathan are both part of the senior management team at DRB-HICOM.

Geely has nominated Daniel Donghui Li and Feng Qingfeng as their nominees to the PHB board. Li is the current executive vice president and CFO of Geely, while Feng is vice president of Geely and CTO of Hong Kong-listed Geely Automobile Holdings.

All five nominees also sit on PONSB board, along with Nathan Yu Ning, who is the vice president of International Business and executive advisor to the president at Geely Holding. Syed Faisal, Farez, Nathan, Li and Yu also sit on the board of Proton Edar Sdn Bhd, the Malaysian distribution arm of Proton.

The full and complete revitalization of proton is the primary goal of both the Board of Directors as well as the executive team that will be leading the change. The joint goal of both teams is to see Proton restored to being the best-selling brand within Malaysia and a top three ASEAN brand in the coming years. To achieve this goal, the management of Proton has established a global team that is able to utilize the leading market knowledge of both shareholders; the leading local knowledge of DRB-HICOM and also the international resources of Geely Holding.

Syed Faisal believes the cooperation between both companies will yield the desired results. “The partnership we’ve established with Geely Holding is already setting down strong roots and showing great promise; we have jointly created a global Board of Directors and will assemble a leading global team to work together on the global revitalization of the Proton brand. I am extremely confident that we can achieve the goals that we have laid down today,” said Syed Faisal.

“After a joint global search for a suitable candidate to realize our shared vision for the future of Proton, both shareholders believe that Dr. Li is the best candidate to completely revitalize Proton. We will use our global resources and synergy to realize the true potential of Proton in partnership with DRB-HICOM,” said Li echoing Syed Faisal’s confidence.

Dr. Li officially became PONSB CEO on October 1 and will be instrumental in working on jointly developed vehicles for Proton. The first of these jointly developed vehicles will be a mid-sized SUV based on the Geely Boyue, the first time that Proton has entered into this hotly-contested segment.

“I was nominated by the board to turn Proton around and I believe the Malaysian car brand will soon be the number one domestic brand and a leading ASEAN brand. To make this vision happen, Proton now has access to the global synergies, expertise and financial support it needs from the Geely family. I firmly believe that Proton’s best days are ahead of it,” said Dr Li.

Meanwhile, Geely Holding’s acquisition of a majority 51 percent share in British sports car manufacturer Lotus from Proton has also been completed. DRB-HICOM started an international bidding exercise for a foreign strategic partner in 2016, which saw more than 30 global companies vetted. Geely Holding was announced as the new strategic partner on May 24 following the signing of a Heads of Agreement in Kuala Lumpur. The minority 49 percent of Lotus Advance Technologies Sdn Bhd is held by Etika Automotive (Etika), a Malaysian automotive group.

With the transaction completed, the Board of Directors for Lotus has been formally established, consisting of five seats of which three are appointed by Geely Holding and two are appointed by Etika.

Under this structure, Geely Holding has appointed Geely Holding’s executive vice president and CFO Daniel Donghui Li as chairman of the Lotus Board. Feng and Yu, aforementioned, will also join the board.

Etika have appointed Dato’ Sharil Tarmizi, a corporate consultant and a long term supporter of technology companies to the Lotus board and will announce a further addition to the board in due course.

Jean-Marc Gales will continue in his role at Lotus as the CEO since joining the company in 2014.

In the first half of 2017, Lotus has already entered into a positive cash flow situation with sales rising by 10 percent in the first half in year-on-year comparison. With the introduction of new models over the course of this year, including the introduction of the fastest Lotus ever made, the Evora GT430, and with further expansion into the U.S. and Chinese markets, Geely Holding is confident that Lotus will continue to excel.

“With the transaction completion we now look forward to working with our partners to develop the Lotus brand into a globally competitive brand and a well-recognized leader in the sports car market,” said Li. “We are extremely confident that Lotus will go above and beyond the expectations of the automotive industry and consumer base in the near future.”

“Following a successful business turnaround, the Lotus brand has never been in a stronger position and we are now perfectly positioned for growth. We are producing the best cars in the company’s history and are currently developing next generation of sports luxury vehicles which will continue to demonstrate the Lotus brand values of class-leading vehicle dynamics, light weighting, styling and aerodynamics by leveraging Geely Holding’s global strengths and resources,” said Gales.

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