India’s top car maker, Maruti Udyog on Thursday said its board had approved the merger of its subsidiary, Maruti Suzuki Automobile India (MSAIL), with it, according to Reuters.
Go deeper with GlobalData
Maruti Udyog – in which Suzuki Motor holds 54.2% – already held 70% in MSAIL, with Suzuki Motor holding the remainder, the news agency noted, adding that Maruti will buy Suzuki’s entire stake for an undisclosed sum.
“This merger will add value for shareholders and eliminate all potential issues relating to inter-company transactions,” Maruti Udyog reportedly said in a statement.
According to an agreement in September 2004, MSAIL was set up as a subsidiary to operate a new car plant in Manesar in northern Indian state of Haryana, which will initially have a capacity of 100,000 cars a year. Capacity will be scaled up to 250,000 cars per annum by 2008/09. The plant will begin production by the end of 2006, Reuters added.
