TPG Rise Climate is the principal investor in this transaction, which values Tata Technologies at Rs 16,300 crore in equity.
Tata Motors Ltd (TML) has signed into share purchase agreements to sell a 9.9% stake in IPO-bound Tata Technologies Ltd (TTL) to private equity fund TPG Rise Climate SF and an endowment trust owned by Tata Trusts Chairman Ratan Tata for Rs 1,613.7 crore. TPG Rise Climate is the primary investor in this transaction, which values TTL at Rs 16,300 crore in equity.
“TTL, a TML subsidiary, is a leading global engineering services company that provides global original equipment manufacturers with product development and digital solutions.” TTL has extensive domain expertise in the automotive business, which it uses to serve clients in adjacent industries such as aerospace, transportation, and heavy machinery construction. “TTL’s deep manufacturing domain knowledge and globally distributed service delivery capability enable it to provide value-added services to its clients,” Tata Motors stated in a stock exchange filing on Friday.
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TPG Rise Climate is TPG’s $18 billion global impact investing platform’s dedicated climate investing arm. The fund focuses on five sub-sectors of climate change: energy transition, green mobility, sustainable fuels, sustainable molecules, and carbon solutions. This deal advances TML’s de-leveraging objective and is likely to finalize in the next two weeks after usual closing procedures are completed, according to the Tata firm.
“TPG Rise Climate had earlier invested $1 billion in Tata Passenger Electric Mobility Limited and is a strategic partner in TML’s journey to create a market-shaping electric passenger mobility business in India,” said Tata Motors.
“On October 13, 2023, Tata Motors Limited and TPG Rise Climate SF Pte. Ltd, a climate focused private equity fund, entered into a Share Purchase Agreement for the purchase of a 9% stake in Tata Technologies Limited.” “On October 13, 2023, Tata Motors Limited and Ratan Tata Endowment Foundation, a Section 8 company, entered into a Share Purchase Agreement for purchasing a 0.9% stake in it Limited,” They said in a stock exchange filing.
Tata Motors stated that the transaction would be completed by October 27, 2023, or any other date mutually agreed upon by the parties. The Company will receive Rs 1,467 crore in consideration for the sale of its 9% interest in TTL to TPG Rise Climate. The Company would receive Rs 146.7 crore in consideration for the sale of its 0.9% interest in TTL to Ratan Tata Endowment Foundation. Tata Technologies’ income from operations was Rs 4,414 crore, and its net value was Rs 2,989 crore as of March 31, 2023.
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