Samvardhana Motherson share price rose over 3 per cent in intraday trade on the BSE on Friday, August 29, looking set to snap its six-session losing streak, after the company revealed latest acquisition updates.
Samvardhana Motherson’s shares opened at ₹92.85 against its previous close of ₹92.09 and rose more than 3 per cent to hit an intraday high of ₹95. Around 12 PM, the stock traded 2.2 per cent up at ₹94.11.
Samvardhana Motherson International acquisition updates
Through an exchange filing on August 29, Samvardhana Motherson said its board had approved to acquire as much as 81 per cent stakes with voting rights in Yutaka Giken Co., Ltd. and an 11 per cent stake in Shinnichi Kogyo Co., Ltd. through its indirect wholly-owned subsidiary, Motherson Global Investments B.V.
Yutaka Giken is a Japanese company and is listed on the Tokyo Stock Exchange, and Shinnichi is a subsidiary of Yutaka Giken with 62 per cent ownership by Yutaka Giken.
The company further said it will acquire 100 per cent of the shares and voting rights in Yutaka Autoparts India Private Limited from Yutaka Giken directly or through its wholly-owned subsidiary.
Meanwhile, Honda Motor Co., Ltd. currently owns a 69.66 per cent stake in Yutaka Giken, and the rest is owned by the public. After Motherson’s acquisition of an 81 per cent stake, Honda will continue to own the remaining 19 per cent voting rights shares in Yutaka Giken.
Motherson Global Investments BV will also acquire an 11 per cent stake in Shinnichi Kogyo Co., Ltd. from Honda.
Yutaka Giken is primarily engaged in the production of metal components and assemblies, including rotors and stator assemblies for motors, drive systems, brake systems, and thermal management systems.
Samvardhana Motherson said the transaction would further strengthen its global partnership with Honda and help expand its share of business with Japanese OEMs (original equipment manufacturers). It would also enable Samvardhana Motherson to potentially cross-sell Yutaka Giken’s existing product portfolio to other OEMs, especially in emerging markets.
In a separate exchange filing on the same day, Samvardhana Motherson said its board had approved acquiring an additional 20 per cent stake of Youngshin Motherson Auto Tech Limited from Youngshin Components Co. Ltd., Korea. After the transaction is completed, Youngshin Motherson will become a wholly owned subsidiary of Samvardhana Motherson.
Youngshin Motherson Auto Tech is a joint venture in India between Samvardhana Motherson International and Youngshin Components, Korea, incorporated in 2017 with a 50-50 shareholding structure.
In June 2023, Samvardhana acquired an additional 30 per cent stake from Youngshin Components. After the completion of the transaction, Samvardhana Motherson will own 100 per cent of Youngshin Motherson Auto Tech.
Further, a separate exchange filing by the company revealed its board of directors approved the scheme for the reduction of share capital by Motherson Technology Services
Limited, subject to the approval of the Hon’ble National Company Law Tribunal.
Samvardhana Motherson International holds a 92.96 per cent shareholding in Motherson Technology Services, and after Motherson Technology selectively reduces the share capital of certain shareholders, it will become a 100 per cent wholly-owned subsidiary of Samvardhana Motherson.
The promoters and promoter group of Samvardhana Motherson hold 3.17 per cent of Motherson Technology’s equity shares out of the total 7.04 per cent external shareholders. The entire minority shareholders, including the promoters and promoter group, will be reduced.
The company said the total payout amounts to approximately ₹335.25 million, of which ₹150.76 million is attributable to the promoters and promoter group.
Samvardhana Motherson share price trend
Samvardhana Motherson share price has declined nearly 30 per cent over the last year (till August 28), hitting a 52-week low of ₹71.57 on April 7 this year after hitting a 52-week high of ₹144.74 on September 27 last year.