Published on September 17th, 2017 | by Amirul Mukminin0
DRB-Hicom, Geely Holding Corporate Exercise Close to Completion
Following the conclusion of the search for a suitable foreign strategic partner (FSP) for Proton Holdings Berhad, DRB-Hicom and Zhejiang Geely Holding are working towards completion of this corporate transaction which is expected to materialise very soon .Currently, both DRB-Hicom and Geely Holding are intensifying efforts to finalise the detailed business plan for Proton Group.
The detailed business planis vital towardsproducing a solid “road-map” for Proton Group for the years ahead; and is one of the key items to be concluded as part of the completion exercise.The business plan will incorporate strategies for both companies to develop new vehicles together for the global market.
Main Companies and Board of Directors
DRB-Hicom and Geely Holding hold 50.1% and 49.9% stakes in Proton Group respectively. The Proton Group is broken down into three key entities which are; Proton Holdings Berhad (PHB), which is the holding company; Perusahaan Otomobil Nasional SdnBhd (PONSB), a 100% subsidiary of PHB, as the main production, operations, manufacturing and marketing company; and Proton Edar Sdn Bhd, a 100% subsidiary of PHB, as the main distribution outfit of the Group. For all three entities, DRB-Hicom has one additional seat at the Board of Directors level; matching the 50.1% that DRB-Hicom holds.
Upon the completion of the transaction soon, an announcement shall be made in due course in relation to the composition of the board of directors of these companies. Each of the companies shall have board representations from both DRB-HICOM and Geely Holding.
Apart from future appointments of the board members,the administrations of the affairs at Proton Group are as follows:
DRB-Hicom’s Group Managing Director, Dato’ Sri Syed Faisal Albar, will continue with his key role as the overall Chairman of PHB. Amongst others, Syed Faisal’s role is to ensure that the tie-up will achieve its benefits and ultimately, provide a return on investment to the shareholders, namely DRB-Hicom and Geely Holding.
At the same time, DRB-HICOM also announced the departure of Dato’ Ahmad Fuaad Kenali as the Chief Executive Officer of PHB effective 30 September 2017. Syed Faisal commended Fuaad on his tenure at the carmaker.
“He has done an impeccable job in his short tenure at PHB. Under his watch, Proton had rolled-out four new models in a span of eight short months. He also played a vital role in closing Proton’s searchfor a suitable FSP. The need for an FSP in Proton was one of the key priorities of DRB-Hicom at the point of our acquisition of PHB in 2012”, Syed Faisal emphasised.
Fuaad was appointed as CEO of PHB on 1 April 2016, after assuming the position of Chief Operating Officer/Senior Group Director of DRB-Hicom in 2013.
Part of the Definitive Agreement signed between DRB-Hicom and Geely Holding is to ensure that Geely Holding not only hold an investment in Proton Group but also for them to lend expertise in the area of production, manufacturing, operations and marketing; namely in PONSB. Pursuant to this, upon completion of this corporate transaction, Geely Holding shall be nominating a suitable candidate as the Chief Executive Officer of Proton Group’s PONSB.
“PONSB is the bulk of the operations of Proton Group, and thus it is critical that we have the right person for the job.An announcement shall be made in due course,”explained Syed Faisal.
In order to ensure a smooth integration, Dato’ Radzaif Mohamed will remain as a key officer at Proton Group and will continue in his role as Deputy CEO at PONSB. Similarly, Abdul Rashid Musa, who was named as CEO of Proton Edar in February 2017, will also continue in his role as the CEO at the distribution arm.
“With Radzaif and Rashid remaining in their positions, this ensures continuity within the Proton Group. It will also ease the transition of the future CEO of PONSB and this can only be good for the venture”, added Syed Faisal.
DRB-Hicom and Geely Holding signed a Heads of Agreement on 24 May 2017 to enable the Chinese carmaker to become a FSP for Proton. On 23 June, both parties signed the Definitive Agreement in Kuala Lumpur witnessed by Prime Minister Dato’ Seri Mohd Najib Tun Abdul Razak.