Tata Motors plans NBFC spin-off, merger with Tata Capital ahead of IPO
Tata Motors is planning to separate its vehicle financing subsidiaries housed under Tata Motors Finance Ltd and merge them with Tata Capital to streamline operations and reduce its debt burden, according to sources familiar with the matter as reported by The Economic Times on May 10.
The proposed move will entail a share-swap arrangement, with Tata Sons, the group holding company, offering shares of Tata Capital to Tata Motors. This transaction would grant India’s third-largest carmaker by volume a minority stake in Tata Capital, the report further elaborated.
An official announcement regarding the merger is anticipated soon. Bank of America is said to be advising Tata Motors on the transaction.
