Maruti vote on giving new plant to Suzuki starts 16 Nov
28 October 2015
Maruti Suzuki India will finally go ahead on 16 November with its much-delayed minority shareholders voting to let parent Suzuki invest in and own the upcoming plant in Gujarat.
The board of directors of the company today approved seeking nod from shareholders through postal ballot / online voting from 16 November to 15 December.
Maruti Suzuki India chairman R C Bhargava said, "The board discussed voting by minority shareholders on Gujarat plant and approved the final contract manufacturing agreement with Suzuki. The voting will commence on 16 November. It will have to be kept open for 30 days, so it will end on December 15."
Results of the voting will be announced on 17 December, he added.
In order to reach out to the investors, the company has already started road shows across various locations.
"We have already started road shows. We had one round of meetings in Mumbai and Singapore with investors. In Hong Kong it will be on November 2-3 and UK on November 5-6. As far as regulatory approvals are concerned, the company has received all necessary nods from all agencies," Bhargava said.
Everything is cleared, even the Gujarat government has given its approval, he said, adding that there is no pending approval from any of the regulatory agencies.
When asked how confident the company is of getting the nod from minority shareholders, he said, "We are very confident. It is a very good deal for them. I don't expect shareholders to let pass this bonanza."
The Gujarat plant was initially planned to be operationalised in May 2017 but "I believe that it may be possible to advance it by a couple of months earlier than that", he added.
"In 2016 Gurgaon and Manesar will be more than fully utilised, so we need the capacity from Gujarat to meet demand," Bhargava said.
Last year, under pressure from institutional investors, Maruti Suzuki had decided to seek minority shareholders' approval after tweaking some of the earlier proposals for the controversial Gujarat plant, which it had initially planned to set up on its own (See: Maruti to take minority shareholders' nod for deal with Suzuki's Gujarat plant).
However, the voting was delayed due to changes in regulations and MSI deciding to comply requirements under the amended Companies Act.
Maruti has been undertaking road shows, to convince both global and domestic investors on its decision to let its parent own the plant at Gujarat, which was initially proposed to be set up by the company.