Motherson Sumi demerger: Shares decline up to 22% ahead of record date
The shares declined as much as 22 per cent from its previous closing price of Rs234.80 per share on the NSE to Rs 182.65 per share on the index
Shares of Motherson Sumi Systems declined nearly 9 per cent to Rs 182.30 per share in Friday's intraday trade on the BSE ahead of the company's record date for the demerger of its wiring harness unit. The shares declined as much as 22 per cent from its previous closing price of Rs234.80 per share on the NSE to Rs 182.65 per share on the index.
Earlier on Jnauary 4, 2022, the auto parts and manufacturer had fixed the Record Date as January 17, 2022 for the purpose of determining the shareholders of the Company.
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As per the arrangement, Motherson Sumi Systems will see demerger of the Domestic Wiring Harness Undertaking of the company into and with MSWIL (“Demerger”). The demerged entity will be called Motherson Sumi Wiring India (MSWIL).
"Directors of the Company, at its meeting held on Tuesday, January 4, 2022 has fixed the Record Date 1, as per the Scheme, as Monday, January 17, 2022 for the purpose of determining the shareholders of the Company to whom the fully paid-up Equity Shares of Motherson Sumi Wiring India Limited will be issued and allotted, in consideration of the demerger of the Domestic Wiring Harness Undertaking into and with Motherson Sumi Wiring India Limited," read a reglatory filing dated Jnauary 4, 2022.
The filing further said that the Equity Shareholders of the Company whose names are recorded in the Register of Members and records of Depositories as a member of the Company as on January 17, 2022, being the record date fixed by Board of directors of the Company, shall be issued and allotted 1 (one) Equity Share of Re. 1 (Indian Rupee One) each of Motherson Sumi Wiring India Limited for every 1 (one) Equity Share of Re. 1 (Indian Rupee One) each of the Company.
Sharp decline in Motherson Sumi Systems stock is apparantely due to the demerger exercise, which has left investors in tizzy.
At 12.10 pm, shares of Motherson Sumi Systems were trading lower by over 6 per cent or Rs 12.50 per share to Rs 187.50 on the BSE.
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