Suzuki raises Maruti stake, fuels talks of full control

[RSM]

Economictimes

Suzuki Motor Corp has raised its stake in Maruti Suzuki to 55%, triggering speculation about the Japanese firm’s intentions for its Indian subsidiary and whether the move is part of a larger plan to take full control of the country’s top carmaker.

Suzuki raised its stake in Maruti by 0.8% through secondary market purchases “very recently”, two persons familiar with the matter told ET. One of them, an investment banker, said Suzuki was set to increase its stake further. Indian rules allow companies to make creeping acquisitions of up to 5% a year and any increase beyond 55% will require Suzuki to make an open offer for another 20%.

Auto analysts and former Maruti officials say the increase in the stake at this juncture could well be part of a larger strategy to gain full control of Maruti, especially in the light of Suzuki’s latest alliance with Volkswagen that saw the German group pick up a 20% stake in the Japanese group.

 

[Aditya]

Well, I guess they know a good thing when they see it!!
Some newspaper was saying that MSIL contributed to 80% of Suzuki's profits in the year. Wow!!

 

[Arun]

Maruti actually out performed Suzuki for total manufactures in a year (There is a thread regarding that as well). I'd say Suzuki is smart more than anything. It efficiently "used" the Maruti name and made itself a force to reckon with in the indian automotive scene. Suzuki has a major stake in the company and I'm most sure of a complete take over. If you haven't noticed, the Maruti insignias have vanished from the front end of cars. It is all Suzuki! The first thing a person will see in a Maruti-Suzuki car, is a Suzuki logo.

 

[Aditya]

Not totally disappeared ... the minuscule number of Gypsies that sell still have a Maruti wings logo!!

 

[Arun]

Only the old ones do buddy. The new ones have the Suzuki insignia. Earlier, people bought a "Maruti", then they bought "Maruti-Suzuki". Now, they'll be buying "Suzuki". Hehe.