Will have full control over Gujarat plant: Maruti

Maruti Suzuki, which is in the middle of a voting by minority shareholders for its upcoming Gujarat plant, has claimed that it will have total control over the plant in spite of investments coming from parent company Suzuki. Maruti's statement is in response to an appeal by proxy advisory firm Institutional Investor Advisory Services (IIAS) last week asking minority shareholders to vote against the Gujarat plant proposal. The company claimed that all profits from the new plant will come to it.

"Maruti will have full control over what happens in Gujarat, and profits from the Gujarat production will come to Maruti. In addition, Maruti will earn treasury income from the money not invested in Gujarat," Maruti said.

IIAS had said in a report last week that if minority shareholders approve the Gujarat plant, Maruti will lose all control over its destiny and the company's shareholders will always remain subservient to the interests of Suzuki's shareholders.

Highlighting the advantage of Suzuki's investment, Maruti said the arrangement will bring foreign direct investment of Rs 8,000 crore to Rs 10,000 crore to India at zero cost to Maruti, while Maruti can earn treasury income from the money not invested in Gujarat.

Maruti claimed the plant will allow it to strengthen its position in the Indian market and, in turn, help both the minority shareholders of Maruti and Suzuki.

The voting process of minority shareholders on the plant started in November 16, and the results are slated to come on December 17.