Search the Internet          Tips  Sites: Finance, Investment

Govt to consult Suzuki on divesting Maruti share

Tara Shankar Sahay in New Delhi

The Cabinet Committee on Divestment decided to renounce its option of subscribing to the rights issue in favour of financial institutions on Tuesday evening but it would only do so after consultation with the joint venture partner Suzuki Company, Japan.

However, the government did not disclose what percentage of shares it will renounce and when it will divest in the open market.

"We are doing it so that the company Maruti Udyog Limited remains a 'market leader of tomorrow'. And at the same time, the government too gets the best value for its equity when we go for divesting our shares," said Arun Shourie, minister for divestment.

"We will consult Suzuki before divesting our stake as Suzuki is a great leader in the world of small cars. And we would like to maximize our benefit before selling our stake," added Shourie.

He also pointed out that this would enable the government to have additional funds for growth.

Shourie also said that in order to determine the value of the rights issue, the government would consult an Indian banker, then the Suzuki company and will divest after both parties reach an agreement.

"There are many points which are still to be negotiated so that nobody comes to dominate the company in future," added Shourie.

Money

Business News

Tell us what you think of this report