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Tata Motors announced the formation of a wholly-owned subsidiary for its commercial vehicle business. The owned subsidiary will be called TML Commercial Vehicle Ltd (TMLCVL).
“TMLCVL is proposed to be incorporated with a paid-up capital of ₹10,00,000 comprising of 5,00,000 equity shares of face value of ₹2 each fully paid-up cash,” the company informed the stock exchanges.
Earlier the company had announced the demerger of its passenger and commercial vehicle business into a separate entity. Further Tata Motors Finance Ltd (TMFCL) will be merged with Tata Capital Ltd(TCL).
The company on Tuesday announced the approval of the merger through an NCL scheme of arrangement. Capital Ltd will issue its equity shares to the shareholders of Tata Motors Finance Ltd effectively holding a 4.7 per cent stake in the merged entity.
“In FY24, TCL and TMFL reported a profit after tax of ₹3,150 crore and ₹52 crore respectively. The transaction is also in line with TML’s stated objective of exiting non-core businesses and focusing its capital spending on emerging technologies and products. TCL has a limited presence in CV/ PV financing. With this merger TCL will gain new customers in the fast-growing CV/PV financing segments, which it aims to serve with innovative products and digital offerings, whilst providing differentiated growth opportunities to employees,” informed Tata Motors in an exchange filing.
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