|VW ORDERED TO SELL SUZUKI STAKE
September 1 2015.
Suzuki received an award on the 29th of August regarding the arbitration that it filed with the International Court of Arbitration of the International Chamber of Commerce on the 24th of November 2011.
The Suzuki Statement reads:
1. History leading up to Request for Arbitration
Suzuki requested Volkswagen AG (“VW”) to terminate their business and capital alliance through amicable negotiation. However, as VW failed to respond to Suzuki’s request, Suzuki served on 18 November 2011 a notice of termination of the Framework Agreement that was made with VW. Further, on 24 November 2011, based on the parties’ agreement, Suzuki filed a request for arbitration in London, which is the place of arbitration with the International Court of Arbitration of the International Chamber of Commerce. Thereafter, a tribunal was organized in accordance with the ICC arbitration rules. Suzuki made certain requests to the Tribunal, including asking the Tribunal to make a declaration that the Framework Agreement was validly terminated and order VW to divest its shares in Suzuki to Suzuki or a third party designated by Suzuki pursuant to that termination.
On the other hand, VW also requested the Tribunal to dismiss all of Suzuki’s claims and uphold VW’s claims including its claim that Suzuki breached the Framework Agreement.
2. Outline of the Award
(i) Termination of Framework Agreement
The Tribunal found that the Framework Agreement was validly terminated by Suzuki’s notice of termination dated 18 November 2011 mentioned above, such termination being effective from 18 May 2012.
(ii) Divestment of Shares in Suzuki
The Tribunal upheld Suzuki's claim regarding VW’s disposal of its shares in Suzuki and ordered VW to divest forthwith those shares to Suzuki or a third party designated by Suzuki using a method which is reasonably determined by Suzuki.
(iii) Suzuki’s Breaches of Agreement
VW's counterclaims of Suzuki’s breach of the agreement were partially upheld and the Tribunal indicated that the amount of damages, if any, would be addressed in a further stage of the arbitration proceedings.
3. Outlook for the Future
Suzuki will closely review the award and will take appropriate measures.
As announced on 9 December 2014, Suzuki intends to acquire the shares in Suzuki from VW through the ToSTNeT-3 system. Suzuki will disclose details regarding the acquisition of these shares as soon as they are determined.
As a result of VW disposing of its shares in Suzuki, there will be a change in our largest shareholder, which is also a major shareholder.
At this stage, Suzuki does not foresee any need to amend its forecast of consolidated results for the fiscal year ending March 31, 2016, however, if any matters that need to be disclosed occur, such matter will be promptly disclosed.