Maruti Suzuki To Acquire Suzuki Motor Gujarat From Japanese Parent Company

Marut Suzuki India on Monday said its board has approved the acquisition of the entire stake in Suzuki Motor Gujarat from Japan-based parent Suzuki Motor Corporation, according to a PTI report.

Currently, Suzuki Motor Corporation (SMC) owns a 100 per cent stake in Suzuki Motor Gujarat (SMG) which supplies its entire production to Maruti Suzuki.

Maruti Suzuki board in its meeting held on Monday approved the termination of the contract manufacturing agreement with SMG, as per the BSE filing.

Maruti's board also gave nod to exercise the option to acquire SMG stake from SMC subject to all legal and regulatory compliances including minority shareholders' approval, stated the PTI report.

Last trading price of Maruti Suzuki India share is Rs 9819.55 per share with intraday gain of 1.56%. Its 52-week high price is Rs 10,036.70 apiece and 52-week low price is Rs 8076.65 apiece, respectively. Its market capitalisation is Rs 2,96,629.03 crore.

Maruti Suzuki shares soared 10% in last 6-months, gave return of 12% in last 1-year, and offered return of 57% in last 3-years.

The auto major expects to complete the transaction by March 31, 2024.

It noted that the mode of acquisition including consideration to be paid to SMC shall be decided in a subsequent board meeting.

With the growth of the Indian car market and export potential, Maruti Suzuki would need to increase its production capacity to about 40 lakh cars per annum by 2030-31, almost double from current levels, the auto major said elaborating on the rationale behind the development, added the PTI report.

This would happen over several locations, some of which are known and some being studied, it added. On the other hand, given the carbon neutrality requirements, several powertrain technologies like EVs, Hybrids, CNG, Ethanol etc. will co-exist for a reasonably long period of time, MSI stated.