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Maruti Suzuki and Suzuki Powertrain Merger Ups Suzuki Stake to 56.2%

The merging of Maruti Suzuki and Suzuki Powertrain raises Suzuki’s stake to 56.2 per cent. Just recently, the board of Directors of Maruti Suzuki India had given their approval to merge Suzuki Powertrain India Ltd (SPIL) and Maruti Suzuki India (MSI).

Suzuki Powertrain Merger Snapshot

Suzuki Powertrain Merger Snapshot

As we all know, SPIL is a subsidiary of Suzuki Motors Corporation and had long been supplying diesel engines and transmission to MSI. For the record, SMC hold a total of 70 per cent of stake in SPIL while the rest is held by MSI. There will be no cash outflow from MSI as the merger since the agreement will be through a share swap.

The swap ration is fixed at 1:70 which means that SMC will receive one share of MSI of Rs 5 each for every 70 shares of Rs 10 each it holds in SPIL. It has been expected that all the needed legal requirements and regulatory approvals will be completed by the end of December 2012.

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