Suzlon Energy’s board has given the green light to the merger of its wholly-owned subsidiary, Suzlon Global Services, with the parent company itself.

What Happened: The wind energy major on Friday announced the merger late on Thursday. Suzlon plans to execute a capital reorganisation through a Scheme of Arrangement, involving the reclassification and transfer of general reserve to retained earnings. This restructuring initiative also encompasses the merger of Suzlon Energy Ltd., Mauritius, another wholly-owned subsidiary, with the parent company. The company also intends to transfer its project business via a slump sale to one or more wholly-owned subsidiaries.

It’s important to note that Suzlon assures that there will be no alteration in its existing shareholding pattern following this restructuring endeavour.

See Also: Bajaj Finance Shares Surge 7% After RBI Removes Ban That Was Imposed In November

Talking about the restructuring efforts, the company said that it will benefit its operations in many ways. The move is expected to streamline communication and decision-making processes, ultimately fostering greater clarity and efficiency across the board.

This restructuring effort is poised to fortify Suzlon’s standalone balance sheet, a critical factor for participating in bids within the public sector undertakings (PSU) segment. The integration of Wind Turbine Generator (WTG) sale and Operations & Maintenance (O&M) services within two divisions of the same entity is set to enhance operational synergy and customer satisfaction.

The restructuring initiative is geared towards optimizing working capital management by eliminating inter-company balances.

Price Action: Suzlon’s share price was down 0.45% to trade at ₹41.50 in the early hours of trading on Friday.

Read next: Adani Ports Shares Upbeat After Q4 As Several Brokerages Raise Price Target

Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.