Suzuki Motor Corporation (SMC) of Japan, the biggest shareholder in Pak Suzuki, intends to acquire complete control of the automaker and delist it from the Pakistan Stock Exchange, according to Reuters.
Pak Suzuki, which assembles Suzuki vehicles and motorcycles in Pakistan, said in a statement to the Pakistan Stock Exchange that its losses in 2019, 2020, 2022, nonpayment of some dividends, and a low share price were among the reasons for the decision. The official statement said:
“Suzuki Motor Corporation intends to obtain full ownership of Pak Suzuki by purchasing all outstanding shares and securities held by minority shareholders, in order to increase ownership and delist the company from the Pakistan Stock Exchange. Considering the unfavorable situation for minority shareholders, it would be beneficial for them to be offered a fair exit.”
SMC currently holds about 73.09% of Pak Suzuki based on the latter’s latest annual statement. Meanwhile, Pak Suzuki also reported on Thursday a loss after tax of 5.871 billion Pakistani rupees ($21.20 million) during the 9-month period in 2023.
Pak Suzuki had to implement a series of plant shutdowns during the current year, along with other automakers in the country. These were due to delays to letters of credit (LCs) needed for imports, and weak demand in Pakistan due to rising interest rates and diminishing purchasing power of the masses.
However rebuking the news regarding its exit, the company’s statement also adds that within Suzuki’s global strategy, Pakistan remains one of the most important markets and the Japanese company is convinced of the future potential of Pakistan. The notification sent to the PSX can be found here.
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