Tata Sons buys stake worth over Rs3,200 cr in 3 group companies

Tata Sons on Tuesday bought shares worth over Rs3,200 crore in three Tata Group companies – Tata Motors, Tata Chemicals and Tata Global Beverages - in a move to reduce cross-holding among group companies.

The move was part of the efforts to disentangle the firms from cross-holding and to simplify the structure, according to reports.

In block deals on the Bombay Stock Exchange, Tata Sons bought 1.34 per cent of Tata Motors' shares at Rs421.44, for a total of Rs1,634 crore. It also bought 4.1 per cent stake in Tata Chemicals at Rs642.55 each and 6.8per cent stake in Tata Global Beverages at Rs 213.35 per stock.

Tata Sons now has 32.4 per cent stake in Tata Motors, 30.3 per cent in Tata Global Beverages and 23.5 per cent in Tata Chemicals.

The money will go to individual companies, helping them to reduce their debt burden, so that they can focus on expanding their business.

The move is to align with specifications of the New Companies Act, a Tata Sons spokesperson said. Giving voting rights to holders of preference shares may also dilute the holding of former chairman Cyrus Mistry's family on the Tata Group holding company.

Tata Trusts chairman Ratan Tata owns 1.05 million preference shares, or nearly a quarter of those outstanding. Narotam Sekhsaria (5.7 lakh shares) and NA Soonawala (2.6 lakh shares) are among other major holders of preference shares.

The Mistry family, which holds an 18.4 per cent stake of Tata Sons, owns just 20,000 preference shares. There are more than 10 individuals, including former employees, who own preference shares in the holding company.