The Tata Group, through Tata Tea and Tata Investment Corporation, is likely to hold a 35-40% stake in Amalgamated Plantations Private Ltd (APPL).
KOLKATA: The Tata Group, through Tata Tea and Tata Investment Corporation, is likely to hold a 35-40% stake in Amalgamated Plantations Private Ltd (APPL). The company was formed to take over Tata Tea’s north Indian plantation business.
Working on a partial employee ownership model, the Tata Group will divest its shareholding gradually with its north Indian plantation employees subscribing to the shares of the new company.
The enterprise value of the north Indian plantations, producing about 35 million kilograms of tea from 24,091 hectares across 24 plantations in Assam and West Bengal has been estimated at Rs 359 crore.
The transaction will also help the Tata Group to part fund its Glaceau acquisition in the US.
APPL, which has a proposed paid up equity capital of around Rs 150-175 crore, will have investors like International Finance Corporation (IFC) and Infrastructure Leasing and Financial Services (ILFS) each with 20% equity and Globally Managed Services with a 12-13% stake. Workers and staff of the north Indian plantations will subscribe to the remaining equity.
At present, Tata Tea has over 30,000 employees and workers at its north Indian plantations. The company expects a positive response from its workers to the new scheme. It has assured the unions that their interest would be safeguarded as per industry norms.
While all the management staff and workers involved in the plantation business will be transferred to the new company, Tata Tea has sought the support of its employees for a “broader employee shareholding”.
“We believe it is in the best interests of all sections of the employees to subscribe to the shares of the new company and participate in future wealth creation. Interest-free loans against shares issued have been arranged to enable workmen to purchase shares and workers have nothing to lose and should dispel any doubts which may exist,” Percy Siganporia, managing director, Tata Tea said.
Tata Tea is offering an interest free loan of Rs 8,000 and Rs 20,000 to enable workers to subscribe to the equity, which will be adjusted through easy instalments over a period of 7 years.
A court meeting is scheduled this week to ascertain the shareholding pattern of the new company.
“We have not put a cut off date for receiving maximum shareholding from workers. We hope to enable a smooth transition from April 1, subject to all requisite approvals,” Siganporia added.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}