Suzuki to Sell Its 1.5% Stake in Volkswagen
September 27 2015 - 8:10PM
Dow Jones News
TOKYO—Suzuki Motor Corp. has agreed to sell its 1.5% stake in
Volkswagen AG to Porsche Automobil Holding SE, the German auto
maker's biggest shareholder, Suzuki and Porsche SE said Saturday,
without disclosing the transaction price.
Suzuki, which holds the stake in Volkswagen as a part of a
failed partnership with the German auto maker, will transfer the
shares to Porsche SE on Wednesday, the Japanese auto maker said in
a statement. As a result of the sales, Suzuki will post ¥ 36.7
billion (US$304 million) in special profit, it said.
Porsche Automobil Holding SE manages assets held by the Porsche
and Piech families—descendants of Ferdinand Porsche, the inventor
of the Volkswagen Beetle—and controls more than 50% of Volkswagen's
voting stock.
The agreement largely ends a failed tie-up between Volkswagen,
one of the world's biggest auto makers, and Suzuki, a second-tier
Japanese auto maker focusing on small cars, following four years of
arbitration.
Over the past week, Volkswagen has lost a third of its value in
the wake of an emissions scandal involving its diesel cars. Despite
the plunging stock price, Suzuki said this week that it still
intended to shed its stake in Volkswagen.
In late 2009, the two companies struck a deal to cooperate in
emerging markets, and work together on the development of
fuel-efficient small cars. As a part of the deal, Volkswagen
purchased a 19.9% stake in Suzuki, while Suzuki acquired a 1.5%
stake in Volkswagen.
Last week, Suzuki repurchased its own shares from Volkswagen for
about ¥ 429 billion, following an order in August by The London
Court of International Arbitration. The court also said that Suzuki
had breached the alliance agreement, and Suzuki has said it may
have to pay damages to Volkswagen.
William Boston in Berlin contributed to this article.
Write to Yoko Kubota at yoko.kubota@wsj.com
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(END) Dow Jones Newswires
September 27, 2015 20:55 ET (00:55 GMT)
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