SAMIL to buy 81% stake in Japan's Yutaka Giken for $181 mn; stock reacts

Samvardhana Motherson International Ltd (SAMIL) to buy 81% stake in Japan's Yutaka Giken for $181 mn; stock reacts shares fell 1 per cent in Friday’s trade after the company announced a plan to acquire 81 per cent of Japan’s Yutaka Giken Co Ltd and 11 per cent of Shinnichi Kogyo Co Ltd via its wholly owned arm Motherson Global Investments B.V. (MGI BV). 

In the same sweep, the group would also buy 100 per cent of Yutaka Autoparts India Pvt Ltd from Yutaka Giken, the company said in a stock exchange filing. 

The Samvardhana Motherson stock fell 1.06 per cent to hit the day’s low of Rs 91.11 on BSE over its previous close of Rs 92.09. At 10:46 am, the scrip was trading 0.88 per cent lower at Rs 91.28. The counter has declined nearly 37 per cent from its 52-week high of Rs 144.74 apiece.

In its board meeting held on August 29, the company said the transactions are for cash and are designed to deepen ties with Honda Motor, which currently owns 69.66 per cent in Yutaka Giken and would retain 19 per cent voting rights post-closure. 

Motherson would hold 81 per cent voting rights in Yutaka Giken after a tender offer and subsequent squeeze-out/stock-consolidation steps mandated under Japanese regulations. “The total expected cash outflow for the 81 per cent shareholding is JPY 27 billion (USD 184 million). The Target is a debt-free company,” the filing said. 

The deal “would further strengthen Company’s global partnership with Honda and help expand share of business with Japanese OEMs,” while opening cross-sell opportunities for Yutaka’s portfolio across emerging markets, Motherson said. 

Yutaka Giken’s core lines include metal components and assemblies, rotor and stator assemblies for motors, drive systems, brake systems and thermal management systems. For FY24-25, Yutaka Giken reported JPY 179 billion (USD 1.2 billion) in net sales and operates 13 manufacturing plants and one R&D facility across nine countries. 

The company would first seek merger-control clearances in Japan, the US, China, Brazil and Mexico, then launch a tender offer (20 business days), followed by settlement within five business days.

 After completing the tender and squeeze-out to leave Honda and MGI BV as the only shareholders, MGI BV would purchase 11 per cent in Shinnichi Kogyo from Honda; Yutaka Giken would then buy back Honda shares to land at the final 81:19 split (voting rights). Subject to conditions precedent, Motherson expects final closing by Q1 FY26-27 (April–June 2026). 

Among technical indicators, the Samvardhana Motherson stock is trading below its 5-, 10-, 20-, 30-, 50-, 100-, 150- and 200-day simple moving averages (SMAs).