GM may bid for stake in Malaysia's Proton -paper

KUALA LUMPUR, Jan 10 (Reuters) U.S. car maker General Motors Corp plans to bid for a stake in Malaysian state-controlled auto firm Proton Holdings Bhd as early as this month, the Business Times said on Wednesday.

GM plans to take a small stake in Proton and a separate equity holding in the loss-making firm's manufacturing arm, the Malaysian daily said, quoting an unnamed industry executive.

Proton badly needs to forge an alliance with a global car maker to reverse sliding sales and safeguard its future, industry analysts say. For the major car makers, Proton offers an under-utilised, state-of-the-art production platform in Asia.

''Since late November, GM had met several times with the management and the shareholders of Proton,'' the Business Times quoted the executive as saying.

It said a Proton official had declined to comment and GM had not responded to an email inquiry.

It quoted Proton's major shareholder, state investment arm Khazanah Nasional, as saying: ''We are unable to confirm or deny on any specifics relating to this matter at this point in time.'' The government says it is willing to sell some equity to secure a partner for Proton and that it is talking to several major car makers, including Germany's Volkswagen and France's Peugeot Citroen.

Reuters DKS VP0620