Tata Motors Concludes the Transfer of Defence Business to TASL
By – Ashwathy Nair
- Tata Motors completed the sale of defence business for an upfront consideration of ₹227.7 cr.
- TML has a wide portfolio of logistics, combat support as well as armoured vehicles for defence.
- The focus is on the development of armoured carriers and platforms.
The transfer of (TML) Tata Motors Ltd’s defence business has been completed to Tata Advanced Systems Ltd (TASL) for an upfront consideration of ₹227.7 crores.
The completion of the transfer is through a slump sale according to the scheme of arrangement that was approved by the National Company Law Tribunal (NCLT) in Mumbai as well as Hyderabad.
It has been several years since Tata Motors Ltd is in the defence sector and currently, it has a wide portfolio of logistics, along with having combat support as well as reinforced vehicles for the defence, paramilitary and state police forces.
In recent years, the company is also focusing on the development of armoured carriers along with platforms such as wheeled amphibious armoured fighting vehicles, mine-protected and light armoured multi-role vehicles.
Tata Motors Ltd has a partnership with the Indian defence establishment in numerous strategic programmes such as MRSAM, Aakash, Agni and BrahMos. It is also exporting a range of defence vehicles to SAARC. ASEAN and African Nations.
Tata Advanced Systems Ltd, which is a wholly-owned subsidiary of Tata Sons, is totally dedicated to providing integrated solutions for defence, aerospace, and homeland security.
The sale of the defence company to TASL is in line with Tata Group’s strategy of consolidating the defence businesses into a single entity to gain size and synergy.
Tata Motors Ltd stated that it will be continuing to play a substantial role in the value chain by supplying chassis as well as aggregating to Tata Advanced Systems Ltd for the development of specialized defence applications while continuing to supply pure civilian passenger along with commercial vehicles in order to defence forces directly.
Tata Advanced Systems Ltd will invest in developing design and development capabilities in order to extend its global footprints and offer specialist, high-value-added, futuristic solutions to defence customers both in and outside of India.
The consolidation will be yielding benefits in the form of operational as well as financial synergies, facilitating for delivering better value for both the entities. Tata Motors Ltd and Tata Advanced Systems Ltd will collaborate closely over the coming months to ensure a smooth transition of the defence market.
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