By IANS,
Tokyo : Suzuki Friday terminated its two-year-old alliance with Volkswagen, alleging that the German company did not honour its commitments and said that it will sue the company if it does not return the shares of the Japanese firm.
“Today (Friday) Suzuki terminated the partnership with VW. Suzuki will be seeking the return of its shares from VW in arbitration,” Osamu Suzuki, chairman and chief executive, Suzuki Motors, said in a statement.
The two companies had entered into a framework agreement in December 2009 through which Suzuki would have gained access to Volkswagen’s technology and in turn the German auto manufacturer picked up 19.89 percent of the Japanese company’s shares for around 1.7 billion euros ($2.3 billion).
“With the cessation of the partnership there is also no basis for VW to hold on to Suzuki’s shares. We will now work to restore the relationship between Suzuki and VW to its original state as independent parties,” Suzuki said.
According to the statement, the company has already served Volkswagen with a “Notice of Breach” on Oct 14.
“Unless Volkswagen AG effectuates the disposition of Suzuki shares to Suzuki or its designated third party immediately, Suzuki will begin arbitration,” the statement said.
The company also blamed Volkswagen for instigating this step.
“They have continued to refuse our attempts on numerous occasions to resolve these issues through negotiation,” Suzuki added.