Mumbai: Tata Sons will infuse Rs 2,600 crore into Tata Power to strengthen the electricity generator’s balance sheet. It will route the funds by subscribing to Tata Power’s 49.05 crore equity shares at Rs 53 apiece.
After the subscription, the Tata Sons stake in Tata Power will increase by 10% to 45%. The fund infusion move by Tata Sons comes after Sebi eased pricing rules for preferential issues and allowed promoters to acquire up to 10% of a listed company through the preferential route without having to make an open offer. Sebi gave the temporary relaxation to enable entities to raise capital fast after businesses came under financial stress due to the Covid-19-triggered slowdown.
The capital infusion into Tata Power — the largest by the Tata Group promoter into an operating company this fiscal — comes after six years when Tata Sons participated in the Rs 1,993-crore rights offer of the electricity producer. Tata Power will use the money to pare its Rs 44,000-crore debt and to execute its long-term growth strategy. At the consolidated promoter level, the Tata Group’s stake in Tata Power will increase to 47% from 37%.
