The Hindu Business Line : Tata Sons pledges 14.6% stake in Tata Steel, 13% in Tata Power

Guarantee
Shares amounting to 50% stake in Tata Teleservices (Maharashtra) have been pledged
Tata Power’s pledged shares are worth Rs 2,500 cr at current market rates

Our Bureau

Mumbai, Feb. 9 Tata Sons Ltd has pledged shares constituting 14.6 per cent and 13 per cent stake in Tata Steel and Tata Power Company, respectively, close to half of the Tata group’s own holding of about 33 per cent each in these companies.

Additionally, shares amounting to nearly 50 per cent stake in Tata Teleservices (Maharashtra) Ltd have been pledged by Tata Teleservices, Tata Sons and Tata Power, disclosures to the stock exchanges showed.

Tata Sons, the chief investment vehicle of the Tata group, through January pledged 3.23 crore shares of Tata Steel whose market value, as on Monday amounted to Rs 1,900 crore.

Tata Sons has also pledged 9.64 crore shares of Tata Power, worth Rs 2,500 crore at current market rates.

Tata Investment Corporation (TICL) has also pledged 25 lakh shares in Tata Steel as security for the Zero Coupon Convertible Bonds issued by TICL which carry no interest cost and are fully and compulsorily convertible into equity shares of TICL. The pledging cannot be invoked as no payment obligations arise from issue of the bonds, said the notice to the stock exchanges.

Over the last two years, the Tata group has borrowed heavily both for acquisitions and expansion plans. Its acquisitions include the Anglo-Dutch steelmaker Corus, marque automobile brands Jaguar and Land Rover; and a 30 per cent stake in two coal mines in Indonesia (for Tata Power). Tata Power has also raised debt for its Ultra Mega Power Project in Mundra, as well as for other projects elsewhere in the country.

In the aftermath of the Satyam scandal, where stakeholders had no idea that promoters had pledged their own shares in the company, SEBI last month made it compulsory for companies to make public disclosure of any pledging of their shares by promoters.

On Monday, the Tata Steel stock gained 7.2 per cent on the BSE to close at Rs 199.55, while Tata Power rose 3.4 per cent, closing at Rs 778.75.