October 06, 2007	Saturday	Ramazan 23, 1428

KARACHI, Oct 5: The swap ratio in the merger of Pak Suzuki Motor Company Limited (PSMCL) with Suzuki Motorcycles Pakistan Limited (SMPL) has been fixed at 1:20.

Shareholders in SMPL would get one share of PSMCL for every twenty shares held in the same group’s motorcycle company. The secretary of the company at PSMCL stated on Friday that the notice of the sanction and final book closure of SMPL would appear in newspapers on Monday, Oct 8.

The merger of motorcycles subsidiary with the parent required approval of shareholders of the two companies at separately held meetings, as well as sanction of the Court.

A notice released at the stock exchange on Friday stated that the High Court of Sindh, Karachi, by its Order dated Sept 17, 2007, had sanctioned the merger of the two companies which had become effective on Oct 1, 2007, i.e. the day when certified copy of the Court Order was filed with the Registrar Companies.

“The Board of Directors of PSMCL has fixed Monday, Oct 29, 2007 as the Record Date to determine the entitlement of SMPL’s qualifying shareholders”, the notice stated.

The scheme of merger of the Japanese motorcycle company in Pakistan with the larger and profitable automobiles producing unit was first unveiled by the Suzuki Motor Corporation of Japan on April 28, 2007. The scheme provided that PSMCL would absorb the remaining 59 per cent stake in the SMPL from Suzuki Motor Corporation.

The Japanese parent has a 43pc stake in the motorcycle subsidiary with the local automobile unit holding 41pc of the company stock.

PSMCL was established in 1982 as a joint venture by the Japanese Suzuki Motor Corporation, with a Pakistani government institution. Suzuki Motor Corporation currently has 73 per cent stake in the Pakistani auto producing subsidiary.

Market sources affirm that during July-Dec 2006, the SMPL produced 12,299 motorcycles, which evidenced a miniscule 5.4 per cent market share of the total production of 226,031 motorcycles in the country during the six months.

PSMCL, on the other hand, holds over 50pc share of the Pakistani automobile market.

Following the notice of sanction of merger, the trading of shares in Suzuki Motorcycles Pakistan would cease from Monday, Oct 29 and PSML would stand de-listed from the three stock exchanges in the country.