The boards of Tata Motors, Tata Capital, and Tata Motors Finance have approved a merger of Tata Motors Fin with Tata Capital through an NCLT (National Company Law Tribunal) scheme of arrangement, Tata Motors said on Tuesday.
As consideration for the merger, Tata Capital (TCL) will issue its equity shares to the shareholders of Tata Motors Finance (TMFL), resulting in the automobile company effectively holding a 4.7 per cent stake in the merged entity.
Tata Motors will hold the stake indirectly through its 100 per cent subsidiary TMF Holdings Limited, an RBI (Reserve Bank of India) registered non-banking finance company-core investment company (NBFC-CIC).
“The transaction is also in line with Tata Motors’ stated objective of exiting non-core businesses and focusing its capital spends on emerging technologies and products,” Tata Motors said.
Commenting that the merger will take 9-12 months to complete, Tata…
