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Private equity firm Warburg Pincus will invest $360 million to acquire 43 per cent equity stake in engineering services provider Tata Technologies Limited.
Warburg Pincus will purchase about 30 per cent from Tata Motors Limited and its subsidiary Sheba Properties Limited, as well as the entire 13 per cent stake held by Tata Capital.
This is Warburg Pincus’ biggest deal in India yet. It had earlier invested in a number of Indian companies including Bharti Airtel, PVR Ltd and Kalyan Jewellers.
For the Tatas, this may be an indication of the group’s intent to dilute presence in non-core areas. Post the transaction, Tata Motors and affiliates of the Tata Group will continue to retain a significant minority interest of approximately 43 per cent in Tata Technologies, with the remainder being held by the management team and other shareholders, a company statement said.
“The partial disinvestment is part of Tata Motors’ plan to strategically monetise part of the value created while also inducting valuable partners, together with whom the company can excel in its next phase of growth,” Tata Motors Group CFO C Ramakrishnan said.
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