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In an exchange filing on Friday, December 6, Samvardhana Motherson said that the deal is likely to be completed by the first quarter of the next financial year.
As part of the deal, a Special Purpose Company (SPC) incorporated by Atsumitec, will first acquire 51.99% stake from existing shareholders with a minimum threshold of 48.02% to be procured.
As of date, the SPC has already acquired 31.75% out of the 51.99% stake from existing shareholders. In case the minimum threshold is not achieved, the deal will not move forward, Samvardhana Motherson said.
Post this, Samvardhana Motherson will acquire the shares from the SPC post required regulatory approvals. This is likely to be completed by the fourth quarter of the current financial year. The deal will make Samvardhana Motherson the largest stakeholder in Atsumitec and also give it consolidation rights and the ability to reconstitute the board of Atsumitec.
Atsumitec will also launch a buyback of shares of Honda Motors. Post this, Samvardhana Motherson will hold a 95% stake in the target entity, while Honda Motors will hold the remaining stake.
On the day of the buyback, Samvardhana Motherson will buy another 49% stake in Atsumitec Indonesia from Honda Motor.
Atsumitec is engaged in the production of high precision machined components, including gear shifters, chassis and transmission parts for four-wheelers and two-wheelers. It has nine facilities across seven countries, including Japan, China, US, Mexico, Thailand, Indonesia and Vietnam.
The acquisition will help Samvardhana Motherson expand its share of the business with Japanese Original Equipment Manufacturers (OEMs). It will also help the company diversify its portfolio by entering into new product lines and new geographies like Vietnam for the two-wheeler segment.
Samvardhana Motherson will also get access to global metal and machining capabilities post the deal.
The deal will require a merger control clearance from the merger control authorities of Japan.
Shares of Samvardhana Motherson are off the highs of the day, currently trading 1.2% higher at ₹168.82.
First Published: Dec 6, 2024 1:01 PM IST
