Tata Steel No Longer Holds Stake In Tata Motors

Tata Steel Ltd. sold its entire stake in group company Tata Motors Ltd., through a block deal on Friday. The steelmaker had already informed the exchanges on June 17 that it would be selling its stake in the automaker to parent Tata Sons on or after June 23.

Tata Steel sold approximately 2.9 percent stake in Tata Motors on the Bombay Stock Exchange at Rs 453.10 apiece, valuing the entire transaction at Rs 3,785 crore, according to Bloomberg.

The steelmaker is expected to use the money it got from the parent to pare some of its Rs 72,367 crore debt, as on March 2017. Brokerage house CLSA had recently said it expected Tata Steel's consolidated debt to rise further to Rs 79,700 crore by the end of the current financial year, putting its debt to equity ratio at 2:1.

Tata Steel has been in talks with Germany's Thyssenkrupp AG and others for a joint venture in Europe since last year, as part of its strategy to trim losses amid a global glut of steel. It recently made a Rs 3,627-crore one-time settlement for a pension scheme to turn its U.K. operations viable.

The inter-group transfer will take Tata Sons'voting rights in Tata Motors to more than 30 percent.

Shares of the automaker pared its opening gains to trade little changed at Rs 452.45. The stock has declined for four out of the five trading session this week. Tata Steel too extended its losses to day three, down over 1.2 percent to Rs 508.60.