Maruti Suzuki board to consider preferential equity issue to parent Suzuki Motor
Maruti Suzuki on Thursday said its Board will meet on October 17 to consider and approve the issue of equity shares of the company to Suzuki Motor on a preferential basis.
«A meeting of the Board of Directors is scheduled to be held on October 17 to consider and approve the issue of equity shares to Suzuki Motor Corporation (SMC) on a preferential basis for consideration other than cash, to discharge the consideration payable by the company for acquisition of 100% equity stake of SMC in Suzuki Motor Gujarat Pvt Ltd,» the company said in a filing.
Earlier in July, Maruti Suzuki India had received board approval to acquire Suzuki Motor Gujarat (SMG) from its Japanese parent SMC. SMG was a wholly-owned subsidiary of Suzuki Motor Corporation and recorded a turnover of Rs 31,853 crore for FY23.
The automaker expects to complete the transaction by the end of the current financial year.
In terms of actual production, logistics, sales and the costs thereof, there will be no change, as the cars earlier supplied by SMG as a contract manufacturer, will now continue to be supplied as before, the company said.
In 2014, the Japanese automaker proposed to set up a separate manufacturing unit in Gujarat, to tap the fastest-growing demand.
With an aim to tap domestic demand and drive exports from India, Suzuki Motor established SMG in March 2014.
