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Motherson tanks 6% as promoter sells 4.4% stake; to dilute holding further

SWS said it intends to further dilute its remaining stake in Motherson over a medium to long term duration as the latter's diversified business lines are not its core areas of focus and expertise

Motherson Sumi. (Photo: Bloomberg)

Motherson Sumi. (Photo: Bloomberg)

SI Reporter New Delhi

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Shares of auto component player Samvardhana Motherson International (Motherson) plunged 5.8 per cent to an intra-day low of Rs 118 on BSE in Wednesday's trade after its promoter entity, Japan-based Sumitomo Wiring Systems (SWS), diluted its stake by 4.43 per cent in the company via a bulk deal today. 

With this, SWS and its arm HK Wiring Systems' joint stake in Motherson has been reduced to 9.89 per cent from 14.32 per cent earlier, it said in a filing. 

SWS said it intends to further dilute its remaining stake in the company over a medium to long term duration as Motherson's currently diversified business lines are not core areas of focus and expertise for the Japan-based firm. 

However, SWS will not sell any more shares in Motherson for the next 9 months. 

Further, with the shareholding of SWS and HK Wiring now below 10 per cent in the company, which will be diluted further, SWS said its best for its representative to step down from the Board of Directors of Motherson. 

Thus, SWS nominee Norikatsu Ishida has resigned as a director from Motherson's board with effect from today March 6, 2024.

Due to the dilution of SWS' holdings below 10 per cent, the company will also ask Motherson to reclassify it as a public shareholder from a promoter entity, the latter said in a filing.  

At 2:24 pm, Motherson's stock had trimmed the day's losses and it was down around 3 per cent at Rs 121. In the last 6 months, the stock has moved up 22 per cent. 

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First Published: Mar 06 2024 | 2:53 PM IST

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