Chinese auto giant Geely has completed the takeover procedures of British sports car manufacturer Lotus Cars. Let’s see what comes out of it now.
Lotus Cars is now a part of the Zhejiang Geely Holding Group. Along with the completion of the transaction that brings Lotus under the Geely umbrella, Daniel Donghui Li has been appointed as Chairman of Lotus Board. Jean-Marc Gales will retain his position as the CEO.
Going into the details of the stakes to be controlled by the entities involved, Geely will be having the majority with 51% and the remaining 49% will be held by Malaysian automotive group, Etika Automotive.
The five seats which form the Board of Directors have been split up in a 3:2 ratio with Geely to have the greater number of members because of its majority stake. The Chinese company has announced the names of all three of its representatives. Etika on the other hand, is yet to finalize the second person and will be making the announcement soon.
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Lotus Cars is already having a pretty good year so far with a 10% improvement in profits during the first quarter of 2017, compared to the same quarter last year. With the expansion of the brand to US and Chinese markets and with the launch of cars like the Evora GT430 and the Evora GT430 Sport, Lotus has the potential to bring in higher operating profits going forward.
Geely has stakes in Malaysian car firm Proton and Swedish manufacturer Volvo too. Its approach of keeping the core team which used to run the show at the companies which it takes over has proven to be beneficial to both parties involved.
The designers and engineers do what they have to do, which is to make great cars that sell, while Geely Holding will take care of the funding. And of course, if the subsidiary companies create something new which Geely can use for its own cars back home in China, it has the liberty for that as well.