TSL to raise stake in Tata Tea to 50%
Tata Sons Limited (TSL), the holding company of the Tata group, will increase its exposure in Tata Tea Limited (TTL) through creeping acquisition route.
By TNN |
KOLKATA: Tata Sons Limited (TSL), the holding company of the Tata group, will increase its exposure in Tata Tea Limited (TTL) through creeping acquisition route. The long-term plan of TSL, which now controls 15.06% stake in TTL, is to raise its stake to 50% in the company within next few years.
Mr R.K. Krishnakumar, director of TSL told newspersons on sidelines of Tata Tea's annual general meeting on Tuesday: "It is the intention of the group to raise the shake in all Tata companies including Tata Tea. The main big player will be Tata Sons."
Reacting to a specific query on Tata Tea, he said: "Ultimately, we would like to make Tata group's presence in the company quite high.... the intention is to go as close to 50%, if possible. But that's a very expensive long-term proposition."
As on March 31, 2006, Tata group companies together hold 28.95%, Indian financial institutions 15.77%, nationalised banks 0.84%, mutual funds 9.71%, FIIs and foreign companies 18.09%, GDS companies 0.15%, other companies 3.77% and individuals 22.72%.
Earlier, addressing shareholders at 43rd annual general meeting (AGM) of Tata Tea, chairman Ratan Tata said: "Tata group plans to increase its holding in Tata Tea. We have no plans for an open offer. Creeping acquisition is the preferred route for us."
Incidentally, in July last, Tata Sons increased its stake in Tata Steel through the preferential route -- a development that followed Tata Sons chairman Ratan Tata's address to shareholders at the company's recent AGM that the only safeguard against hostile takeovers was to increase promoter's shareholding.
The Tata group is also working hard to restructure cross-holdings in various companies. "We have done it for some of our group companies. Some are underway. However, some strategic cross-holdings would remain in the interest of the company and shareholders," added Mr Krishnakumar.
Mr Krishnakumar however, declined to comment whether the group has prepared a corpus for increasing stakes in group companies. "Fund will not be a problem for us. We are comfortable enough to carry on the exercise as and when opportunities come."
Mr R.K. Krishnakumar, director of TSL told newspersons on sidelines of Tata Tea's annual general meeting on Tuesday: "It is the intention of the group to raise the shake in all Tata companies including Tata Tea. The main big player will be Tata Sons."
Reacting to a specific query on Tata Tea, he said: "Ultimately, we would like to make Tata group's presence in the company quite high.... the intention is to go as close to 50%, if possible. But that's a very expensive long-term proposition."
As on March 31, 2006, Tata group companies together hold 28.95%, Indian financial institutions 15.77%, nationalised banks 0.84%, mutual funds 9.71%, FIIs and foreign companies 18.09%, GDS companies 0.15%, other companies 3.77% and individuals 22.72%.
Earlier, addressing shareholders at 43rd annual general meeting (AGM) of Tata Tea, chairman Ratan Tata said: "Tata group plans to increase its holding in Tata Tea. We have no plans for an open offer. Creeping acquisition is the preferred route for us."
Incidentally, in July last, Tata Sons increased its stake in Tata Steel through the preferential route -- a development that followed Tata Sons chairman Ratan Tata's address to shareholders at the company's recent AGM that the only safeguard against hostile takeovers was to increase promoter's shareholding.
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The Tata group is also working hard to restructure cross-holdings in various companies. "We have done it for some of our group companies. Some are underway. However, some strategic cross-holdings would remain in the interest of the company and shareholders," added Mr Krishnakumar.
Mr Krishnakumar however, declined to comment whether the group has prepared a corpus for increasing stakes in group companies. "Fund will not be a problem for us. We are comfortable enough to carry on the exercise as and when opportunities come."
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