Tata Sons is likely to use the money raised to shore up its holdings in various listed companies
Tata Sons sold a little over 3.12 crore shares of Tata Consultancy Services (TCS) on the bourses to raise Rs 8,989.84 crore on Tuesday. The amount of shares offloaded through two transactions by the parent company of TCS translates to around 1.63% stake. Post the share sale, Tata Sons's holding in the IT company would drop to around 72%.
The shares of Asia's largest software developer (TCS) were sold in block deals to investors. Nearly 2.06 crore shares were offloaded at a price of Rs 2,876.46 a piece. Another 1.06 crore scrips were sold at Rs 2,872.19 apiece, as per NSE bulk deal data.
On the National Stock Exchange, shares of TCS fell 5.44% on Tuesday closing at Rs 2,886.80 a piece as compared to Monday's closing price of Rs 3,052.15 per share.
Tata Sons, the principal shareholder and promoter of various Tata Group companies, is likely to use the money raised to shore up its holdings in various listed companies.
DNA Money had, on December 14, 2016, reported the possibility of Tata Sons raising funds by selling TCS shares for funding a stake hike in various listed group companies amid a raging corporate war with former chairman and director Cyrus P Mistry.
Last week, Tata Sons said it will invest at least Rs 1,077 crore to hike stake in the BSE-listed hospitality arm Indian Hotels Co Ltd.
It is set to acquire 7.89 crore shares (from Sir Dorabji Tata Trust, Lady Tata Memorial Trust and Sir Ratan Tata Trust) representing 6.64% stake in IHCL thereby taking its overall shareholding in the hospitality firm to 36.43%. As part of restructuring its investment portfolio, Tata Sons will acquire additional shares in IHCL anytime on or after March 13, 2018.
Tata Sons may also use a portion of the funds raised from the stake sale to pay off creditors of its wireless division, said a Bloomberg report. Tata sold Tata Teleservices Ltd's mobile-phone operations to Bharti Airtel last year and pledged to pay the unit's obligations.
The conglomerate has been planning to raise its ownership over time in five of its largest businesses including Tata Chemicals and Tata Steel. Last year, it boosted its stake in Tata Motors that also owns Jaguar Land Rover.
PAYING OFF DEBT
- Tata Sons is likely to use the money raised to shore up its holdings in various listed companies
- Last week, the Tata group holding company said it will invest at least Rs 1,077 crore to hike stake in Indian Hotels Co Ltd
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Tata Sons, the principal shareholder and promoter of various Tata Group companies, is likely to use the money raised to shore up its holdings in various listed companies.
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