The latest principal to enter the Malaysian market with stakeholding is Suzuki Motor, which has just acquired 40% of Suzuki Malaysia Automobile, previously a DRB-Hicom company. Suzuki will pay RM 14 million for the 40% stake, and another 20% stake will be taken up by Japanese trading form Itochu, which will pay RM 7 million. The remaining 40% is held by DRB-Hicom.
“The proposed joint venture displays Suzuki’s strong commitment to strengthen its relationship with DRB-Hicom in the marketing, distribution and assembly of Suzuki vehicles in Malaysia and to widen its product range and models in Malaysia,” said DRB-Hicom in a statement.
The new JV will be complete by end Q1 2008, and will involve subscription of new ordinary shares of RM1.00 each in SMA. SMA will issue and allot a total of 21 million new ordinary shares of RM1.00 each in SMA, through an increase in issued and paid-up capital from RM14 million to RM35 million. DRB-Hicom is expected to realise an estimated gain of RM5.2 million from the Proposed Joint Venture based on SMAs audited financial statement for the financial year ended 31 March 2007.
This could mean faster time to market for new Suzuki products in Malaysia as well as perhaps better allocation of stock to reduce waiting times.