Home-grown auto component manufacturer Motherson Sumi Systems (MSS) informed BSE that it has received its shareholders’ nod for the proposed restructuring plan. The public shareholders (non-promoter) have voted in favour of the proposal with a majority, thus paving the way for the successful completion of the proposed restructuring.
For the NCLT convened meeting regarding the scheme of reorganisation, the voting results showed that 99.44% of the non-promoter shareholders who voted favour the proposed restructuring.
Also, the requirement of obtaining creditors approval has been waived off by NCLT for the scheme. The public shareholders also approved the Related Party Transaction (RPT) resolution through a separate EGM held on the same day.
As the next steps, post-filing of the shareholder meeting documentation, the company will approach NCLT for a second motion petition to approve the scheme.
Post the approval from NCLT, the company will work with the stock exchanges for a listing of the securities. Listing is estimated to be completed by Q2 FY21, subject to the receipt of the necessary approvals. Once the proposed reorganisation is completed, two growth-focused listed companies will emerge.
Motherson Sumi Wiring India (MSWI) will be the largest listed automotive wiring harness player in India, with a nationwide manufacturing footprint.
It will benefit from the continued parentage of MSS along with an increased focus from Sumitomo Wiring Systems, Japan (SWS) to cater to the fast-growing Indian automotive market. Also, MSWI will bring in exciting new solutions for electric vehicle offerings from our customers.
MSS, combined with Samvardhana Motherson International business, creates a solid platform to achieve its stated Vision 2025. The company will now fully own its international business Samvardhana Motherson Automotive Systems Group BV, which not only results in a simplification of the group structure and enhanced cash flows but also further diversifies MSS’s revenue and product mix by the addition of products like automotive lighting, shock absorbers, sheet metal, HVAC etc. in line with our 3CX10 strategy.
Vivek Chaand Sehgal, Chairman, MSS, said, “We thank our shareholders for their support and trust in the capabilities of Motherson. This is an important step for us to achieve the next phase of growth for our group. The existing automotive business, along with the addition of the exciting new business verticals, makes us confident in achieving our Vision 2025 targets.”