Maruti Suzuki India Ltd. will be issuing 1.23 crore equity shares of the company having a face value of Rs 5 each to Suzuki Motor Corporation on a preferential basis, as per an exchange filing on Tuesday, October 17.

The shares will be issued at a price of Rs 10,420.85 per share. This is a 2.6% discount to the automaker's closing price on Monday. The average traded price of Maruti's shares over the last 15 trading sessions is Rs 10,471.

The total value of the shares being issued to Suzuki Motor Corp. is Rs 12,841.1 crore.

Post the preferential issue of shares, Suzuki Motor Corporation, Japan's shareholding in India's largest passenger car manufacturer will go up to 58.19% from 56.48% earlier.

The issue of shares comes after Maruti's board terminated the contract manufacturing agreement with Suzuki Motor Gujarat Pvt. Ltd. and exercised the option to acquire the shares of SMG from Suzuki Motor Corporation.

Suzuki Motor Corporation is currently the 100% shareholder of Suzuki Motor Gujarat.

In terms of actual production, logistics, sales and the cost 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.

Shares of Maruti Suzuki India gave up all their gains to fall to the day's low after the announcement.

The stock is currently trading 0.6% lower at Rs 10,642.5.

First Published:Oct 17, 2023 10:12 AM IST