Maruti Suzuki India Ltd (MSIL) is now a step closer in its pursuit to acquire the Suzuki Motor Gujarat plant – a subsidiary of the Suzuki Motor Corporation (SMC). In a Board of Directors meeting held on October 17, the company agreed upon the final settlement to be paid to its parent firm as part of a deal that will see the Indian entity issue shares to SMC to acquire its 100 per cent equity stake in the Gujarat manufacturing plant.
Also read: Maruti Suzuki Offers Preferential Shares To Acquire Gujarat Plant From Suzuki Motor
As part of a share purchase and subscription agreement, MSIL will acquire 12,84,11,07,500 shares, representing the 100 per cent equity capital in Suzuki Motor Gujarat from SMC. The total consideration, valued at Rs 12,841.1 crore is set to be paid in the form of allotment of 1,23,22,514 equity shares of MSIL valued at Rs 10,420.85 per share on a preferential basis. This will mean that SMC will hold an increased stake in the Indian entity from the current 56.48 per cent. The move, however, is still subject to shareholder approval and all regulatory and legal compliances.
Also read: Maruti Suzuki India Set To Acquire Suzuki Motor Gujarat As Its Wholly-Owned Subsidiary
The postal and e-ballot with shareholders will be held between October 18 and November 16 with the results to be Declared on November 20.
MSIL had first revealed its plans to acquire Suzuki Motor Gujarat as its 100 per cent subsidiary back in July this year with the company board agreeing to settle the acquisition through the issue of shares in August 2023. MSIL is looking to complete the acquisition process by end-March 2024.
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The acquisition of the production facility will provide MSIL with additional production capacity. The plan in Gujarat has an installed capacity of 7.5 lakh units per year.
