Tata Trusts chairman Noel Tata on Thursday presented Tata Sons board members a proposal from Shapoorji Pallonji Group (SP Group) for monetisation of its stake in the holding company.
SP Group owns 18 per cent in Tata Sons and is looking at various ways to raise liquidity to repay debt.
As per the SP Group proposal the transaction envisages Tata Sons buying back of shares held by SP group entities that would yield a minimum ₹25,000 crore.
The SP Group favours buyout in two two tranches over 18 month period with Tata shares valued as per income tax fair value. The SP group has also suggested that Tata Sons carry out selective capital reduction through NCLT.
Tata suggested that various avenues could be used for the purpose of raising the funds required for this purpose, including from internal cashflows; sale of listed shares; bringing in an investor into some of the newer businesses and listing, upon an offer for sale, of some of the businesses.
He requested the board to take the necessary steps for initiating the NCLT process and authorise the operating team of Tata Sons and the Tata Trusts to continue discussions with the SP Group, and the bankers.