German luxury car maker BMW will take over the distribution of its vehicles in Malaysia ahead of market liberalisation here in 2005, a report said today.

BMW will sign a pact tomorrow with local franchise Sime Darby Bhd. to set up a joint venture company, in which it will hold a 51 percent stake and Sime the balance, the New Straits Times reported.

The move ended months of negotiations between the two parties and came after BMW decided last year to make Malaysia the regional centre for its Asian operations, it said.