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.