Alliance Threatened Volkswagen Group Considers M & A Suzuki Motors

According to Reuters, Volkswagen Group may consider the acquisition of Suzuki Motors to maintain the cooperation between the two parties in the event that the alliance with Suzuki Motors is on the verge of disintegration.

On September 18th, 2011, German Der Spiegel quoted an anonymous public executive saying that “doesn't rule out the possibility of mass mergers and acquisitions of Suzuki.” Since the Ice Age, which was linked to Suzuki for two months, in particular, Last week, after Suzuki announced that it was preparing to dissolve the alliance with Volkswagen, the public has been struggling to maintain its alliance and expressed its willingness to invest in the alliance. According to the "Der Spiegel Weekly," if the alliance between VW and Suzuki survives, the public will need to agree to increase the stake by Suzuki. However, if the alliance breaks down, the public will be free to increase their holdings.

On September 11, 2011, Volkswagen accused Suzuki of purchasing a diesel engine from Fiat in violation of the alliance agreement. On the 12th, Suzuki Motor’s CEO Suzuki repaired the “default” and said that he complained that the public had excessively interfered with Suzuki’s operations and infringed Suzuki’s independence, and announced plans to end the alliance with the public. There is still no sign in the public that it will agree to terminate the partnership.

Volkswagen had purchased 19.89% of Suzuki shares for US$2.5 billion, and Suzuki also held a 1.5% stake in VW. Suzuki repairs demand for Suzuki shares held by Volkswagen, but Volkswagen has allegedly no intention to sell Suzuki shares.