Maruti to issue Rs 12,800 cr worth of shares to Suzuki to buy Gujarat plant

The country’s largest carmaker Maruti Suzuki on Monday said its board has approved a proposal to execute a share purchase agreement to acquire 100% equity capital of Suzuki Motor Gujarat (SMG) from parent Suzuki Motor Corporation (SMC).

Maruti Suzuki has executed the share purchase and subscription agreement (SPSA) with SMC and SMG to acquire 12,84,11,07,500 shares of Rs 10 each, representing 100% equity capital of SMG owned by SMC, for a total purchase consideration of Rs 12,841.1 crore, the company said in a regulatory filing.

The consideration payable by the company for such purchase of 100% of SMG’s equity shares shall be discharged by way of issue and allotment of 1,23,22,514 equity shares of the company having face value of ₹5 each to SMC, at a price of Rs 10,420.85 per share, on a preferential basis, it added.

Voting for shareholder approval begins on Wednesday and will go on for a month.

Earlier in August this year, the company’s board had approved issuance of shares on a preferential basis to SMC as consideration for acquisition of 100% stake in SMG. Post the acquisition, SMG would become a wholly-owned subsidiary of MSIL.

Maruti Suzuki board, in its meeting on July 31, 2023 had approved termination of the contract manufacturing agreement with SMG and acquiring its shares at a price to be determined in accordance with all applicable laws and regulations.Maruti Suzuki had said that it will acquire the Gujarat-based production facility of its parent firm SMC to reduce complexity and bring all manufacturing-related activities in the country under one entity.A fully-owned subsidiary of SMC, SMG supplies its entire production exclusively to Maruti Suzuki India. SMG, which was incorporated in 2014, has a production facility in Gujarat with an installed capacity of 7.5 lakh units per annum.

FOLLOW US ON GOOGLE NEWS

Read original article here

Denial of responsibility! Todays Chronic is an automatic aggregator of the all world’s media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials, please contact us by email – todayschronic.com. The content will be deleted within 24 hours.

Leave a Comment