Tata Motors’ board of directors has authorized a partial divestment of the business in Tata Tech IPO, its fully-owned subsidiary, via an initial public offering (IPO), according to an exchange filing. The subsidiary is involved in product engineering and digital services.
“We wish to inform you that the IPO committee (duly constituted by Tata Motors’ board of directors) has accorded its in-principle approval to explore the possibility of partial divestment of the company’s investment in Tata Technologies, a subsidiary of the company, through an IPO route at an opportune time,” it said in the filing.
If this tata tech IPO happens before Tata Play, it will be the Tata group’s first IPO since it floated Tata Consultancy Services in 2004. It will also be the first under N Chandrasekaran’s presidency, who took over as Tata group chairman in 2017.
Tata Play is also planning an IPO after tata technologies IPO news comes into the market. On November 29, the direct-to-home platform filed a confidential draught red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi). It is the first firm to go through the pre-filing process for its IPO.
According to Tata Motors, the Tata Tech IPO will be subject to market circumstances, necessary permissions, regulatory clearances (including Sebi observations), and certain other considerations.
The business said it will make additional notifications about the IPO as needed, in accordance with the SEBI LODR Regulations and other relevant regulations.
According to the company’s 2022 annual report, Tata Motors owns 74.42% of Tata Technologies. For over five years, the Tata group’s flagship has been intent on departing the technology services industry as part of a bigger plan of abandoning non-core companies.
After an official announcement on the tata tech IPO agreement, it called off the sale of a large minority share (43%) in Tata Technologies to private equity company Warburg Pincus for $360 million in 2018, claiming non-receipt of regulatory approvals and issued in internal performance owing to market circumstances.
Tata Technologies, founded in 1989, provides technological services in the automotive, industrial equipment, aerospace, and related engineering and manufacturing sectors.