Tata Group Plans To Halve Number of Listed Companies For Better Focus On Growth, Scale

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The Tata group is planning to halve the number of listed companies in the conglomerate to an estimated 15 from 29 in the coming months, according to an ET report. It is aimed at shifting the company’s focus on investing in fewer but bigger entities that can ably compete in the marketplace.

As part of Tata Sons Chairman N Chandrasekaran’s plan to make India’s oldest conglomerate future-ready, the group is making strategies for better focus on growth and scale and for improving cashflows in larger companies, the report said quoting company executives.

The executive, as per the report, said a lot of management time and effort that’s put into smaller companies will also be minimised through this effort. The Tata group has a total revenue of $128 billion and a market cap of $255 billion. It has 29 listed companies, nearly five dozen unlisted firms, and hundreds of subsidiaries in 10 sectors.

Last week, Tata Steel has said its board of directors has approved the amalgamation of all metal companies of the Tata group into it. There are seven metal companies that will be merged with Tata Steel — Tata Steel Long Products, The Tinplate Company of India, Tata Metaliks, TRF, The Indian Steel & Wire Products, Tata Steel Mining, and S&T Mining Company.

The merger is subject to regulatory and other approvals. “Each scheme is subject to the receipt of approval from the (a) requisite majority of the shareholders of the respective transferor companies and transferee company; (b) competent authority, (c) SEBI (d) National Stock Exchange of India and the BSE; and (e) such other approvals, permissions and sanctions of regulatory and other statutory or governmental authorities / quasi-judicial authorities, as may be necessary as per applicable laws,” according to a BSE filing.

Explaining the rationale of the merger, Tata Steel said, “The amalgamation will consolidate the business of TSLP and transferee company which will result in focused growth, operational efficiencies, and business synergies. In addition, resulting corporate holding structure will bring enhanced agility to business ecosystem of the merged entity.”

Tata Steel is a leading global steel company, with over 100 years of experience in the steel sector and is a pioneer of steel manufacturing in India. TSLP is in the business of production and marketing of sponge iron, which is a single end use (steel making) and a single grade product. It has also one of the largest specialty steel plants in India in the special bar quality segment.

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