Lotus cleared of £40m debts


23 March 2007 09:01

Norfolk-based sports car maker Group Lotus is being given a fresh start by its owner which effectively written off the company's £40m debts.

Proton, Malaysia's national car maker, has given Lotus a loan to pay off the debts it has run up with external lenders.

Recently reappointed Lotus chief executive Michael Kimberley, who was in charge of the firm for much of the 1970s and 1980s, has drawn up a five-year turnaround plan.

It envisages a radically-revised product range, with three model lines, and hopes to double the company's car output to about 8,000 a year.

The current Elise, Exige and Eurpoa will still be produced, but more and faster variants are to be launched over the next few years.

Proton is to convert the loan into further equity in Lotus, in effect writing it off unless and until the firm can turn around its financial fortunes.

It has been warned that Lotus has little prospect of returning to profitability before the 2008-09 financial year.

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