Volvo and Lotus have merged under one parent company. Geely, the Chinese auto company that owns Volvo, bought controlling stakes from Proton, Lotus' carmaker, and the deal will be finalized in July.

Geely now owns 51 percent of Lotus shares as well as 49.9 percent of Proton shares. The move saves Lotus from its long-standing financial problems and could put the British sports car brand back on track.

Lotus struggled to make profits for years. In 2014, however, the company posted Jean-Marc Gales as its CEO and he worked to turn the business around, as per BBC.

Lotus is planning an SUV range expansion as well as the release of an updated version of its Elise sports car, which was first launched in 1996. Geely's takeover comes at a right time as the company needs to finance its ongoing developments, as per Auto News.

Proton, the Lotus owner since 1996, remains a majority stakeholder of the brand but the Geely ownership will be a big boost. "Our very own much-loved brand now has a real chance of making a comeback, a huge one I hope," Johari Abdul Ghani, Malaysia's Second Finance Minister said, as per Business Insider.

Geely also stands to benefit from the merge. By buying stakes at Proton, Geely can have access to the Southeast Asian market where it could establish Volvo.

The partnership will also enable the companies to tap suppliers and other resources. Geely could gain from using Proton's engineering for its lightweight cars based on standards and regulations in the Asian market. Proton and Lotus can access Volvo's supply chain for electric car batteries, motors and platforms that could elevate the future of the sports car.

Geely transformed Volvo's finances when it took over Ford's ownership in 2009. Industry experts expect it will be able to do the same for Lotus and Proton. Learn more about Geely and Proton's new deal in the video below.

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