Suzuki Motor Corp announced Saturday it has decided to divest its full 1.5 percent stake in Volkswagen AG in a deal with Porsche Automobil Holding SE and thus will have a special profit of 36.7 billion yen ($304 million).
The second-tier Japanese automaker announced over the weekend that Porsche Automobil Holding SE has purchased a total of 4, 397,000 Volkswagen common shares and the transfer process would be completed on Septemebr 30. Porsche in turn announced through a statement on its website that the size of its holding in Volkswagen Ag, the (interim) largest automaker in the world, has grown to 52.2 percent following the approaching transfer. Suzuki has repurchased from the German manufacturer a 19.9 percent holding of its own stock – Volkswagen was ordered to divest it by an arbitration court last month after the two carmakers had a fallout following a cooperative agreement.
While the Japanese automaker had to pay in full its 19.9 percent share last month, most likely Suzuki didn’t get a very sweet deal on the 1.5 percent holding as the German automaker has lost a third of its value over the course of a week following the diesel emissions testing cheating scandal. Investors have been sent spiraling down while analysts have seen a hole blown through their third quarter earnings predictions because the carmaker will incur heavy losses while dealing with the aftermath of the still developing “dieselgate”.