Tata Steel Ltd. on Friday, as part of its portfolio restructuring, sold 385.21 lakh shares (1.33 per cent stake) of Tata Motors Ltd. to institutional investors for Rs.1,250.69 crore.
The sale of shares with a face value of Rs.2 each at Rs.324.67 per share was executed over the stock exchange following a price discovery through book building process.
With this, Tata Steel’s stake in Tata Motors has come down from 5.54 per cent to 4.21 per cent.
The company has also decided to sell Tata Motors’ shares worth Rs.1,250 crore to Tata Sons Ltd., the holding company of the Tata Group. This transaction will be at market price through an off-market transaction, Tata Steel said.
Tata Steel did not reveal where it will deploy the funds mobilised from the sale of Tata Motors’ shares.
An email to Tata Steel remained unanswered.
Tata Steel had a consolidated debt of Rs.69,000 crore as on March 31, 2015, and the sale could be part of its plan to reduce the debt said analysts.
Meanwhile, the Bombay High Court has approved the scheme of amalgamation between Tata Steel and Tata Metaliks Ltd. and Tata Metaliks Dl Pipes Ltd. (formerly known as Tata Metaliks Kubota Pipes Ltd.) and their respective shareholders and creditors.
The scheme of amalgamation is still pending before the Calcutta High Court and the same will be effective only upon sanction by the Calcutta High Court, Tata Steel informed the stock exchanges.
