Maruti Suzuki to Issue Shares Worth $1.54 Billion for Gujarat Plant Acquisition

17 Oct 2023 , 02:17 PM

Maruti Suzuki India will issue shares valued at 128.41 billion rupees to Suzuki Motor to acquire a local manufacturing plant in Gujarat. This marks the first time Maruti has revealed the plant’s value, initially announcing the purchase in July.

The share issuance consists of 12.3 million preference shares priced at 10,420.85 rupees each, representing a 2.7% discount to the stock’s closing price on the previous day.

This transaction will raise Suzuki’s ownership stake in Maruti from 56.48% to 58.19%, in line with previous estimates.

Suzuki has invested approximately 180 billion rupees in the Gujarat plant since 2014, which commenced operations in 2017 and has an annual production capacity of 750,000 units. Maruti’s acquisition of the plant aims to enhance control over production, particularly in electric vehicles (EVs), and provide flexibility to adapt to shifts in demand.

The company’s first EV, an SUV, will be manufactured at the Gujarat plant, with plans to introduce six EV models by 2030, all produced at the same facility.

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