New Delhi. Tata Motors will separate its passenger and commercial vehicle business. The company’s board has approved the division of its business into two companies after the demerger and separate listing on the stock exchange. The demerger process will be completed in 12 to 15 months. After the demerger, Tata Motors’ commercial vehicles business will be included in a separate entity, while the second entity will be formed as a separate company by combining passenger vehicles, electric vehicles, JLR and its related investments.
Under the demerger process, shareholders holding shares of Tata Motors will get shares of both Tata Motors’ passenger and commercial vehicle companies. Tata Motors gave this information while announcing the results of the June quarter of FY 2024-25. In a regulatory filing, the company said, “The board has approved the scheme of demerger of two separate listed companies of Tata Motors and the demerger process will be completed in 12 to 15 months”.
Shareholders will benefit
While taking the decision of demerger of Tata Motors, the company had said that the decision of demerger would benefit the shareholders. In the last few years, Tata Motors’ Commercial Vehicles, Passenger Vehicles including Electric Vehicles (EV) and Jaguar Land Rover have shown very strong performance. Since 2021, both the segments have been working independently under the supervision of their respective CEOs.
These two companies will merge
This demerger process of Tata Motors is the result of the decision to create a separate subsidiary of passenger and electrical business in 2022. The company said in a regulatory filing that the process of merger of Tata Motors Finance and Tata Capital is underway. This process will be completed in 9 to 12 months.
Tags: Business news, Tata Motors
FIRST PUBLISHED : August 2, 2024, 07:34 IST