GERMAN MEDIA FRENZY OVER POSSIBLE VW-PROTON ALLIANCE
Wednesday, October 10, 2007; Posted: 02:06 AM
FRANKFURT (Germany), Oct 10, 2007 (AsiaPulse via COMTEX) — Germany’s print and broadcast media, not to mention the specialised trade media, have been churning out reports over the past few days about an impending deal between Wolfsburg-based giant carmaker Volkswagen (VW) and Malaysia’s national car company Proton (KLSE:5304).
Germany’s leading dailies such as the Frankfurter Allgemeine Zeitung, Die Welt and the Handelsblatt have been speculating that VW may finally be on its way to forming an alliance with Proton, by either acquiring a 20 per cent stake in Proton or forming a joint venture company which would include Proton assets.
Later, VW might increase its stake in Proton to 50 per cent. An indication to this effect was given by VW head Martin Winterkorn himself in a recent interview with the Frankfurter Allgemeine Zeitung, when he said that VW would “move in that direction”.
VW’s acquisition of Proton will strengthen the German carmaker’s position in Southeast Asia.
But VW, according to Winterkorn, would like to see the risks minimised and is also interested in Proton’s extensive network of dealers and agents.
But he also emphasised in the interview that VW was “nowhere even near a due diligence”. He would first see what concessions Malaysia had to offer.
However, German industry pundits said that VW could afford the luxury of waiting longer while the Malaysian side could not.
Indeed, VW will insist that the Malaysian government provides a “soft landing” cushion to compensate it against any losses at Proton for, at least, three years. Continue reading “Proton-Volkswagen deal – “a buyer’s market””
