More than 18% stake mortgaged, business to be sold to Mukesh Ambani’s Reliance…, who is troubling Ratan Tata’s Tata Group? Name is…

The Tata Group is facing challenges from its largest minority stakeholder, the Shapoorji Pallonji (SP) Group. They have an 18.37% stake in Tata Sons. The SP Group is debt ridden and to tackle it has pledged its entire holdings. The group is requesting for Tata Sons’ stock market listing and seeking intervention from the RBI. 

SP Group On Tata Sons’ Listing

The debt-ridden SP Group has once again supported the listing of Tata Sons, which is the holding company of the Tata Group. According to reports by The Economic Times, the SP Group has requested the RBI, stating that a listing will benefit all stakeholders.

SP Group is As Tata Sons’ largest minority shareholder and owns an 18.37% stake in the company, valued at Rs 3 lakh crore ($35 billion). The SP Group is facing financial stress and finds the listing of Tata Sons as a solution to its debt ridden problem.

Tata Sons Request

In 2024, Tata Sons submitted an application to the RBI to cancel its registration as an Upper Layer Core Investment Company (UL CIC). It may help them to exempt Tata Sons from mandatory stock market listing by September 2025, as per requirement of RBI’s NBFC-UL classification.

However, the SP Group claims it was not consulted on this critical decision and demanded its inclusion in it. The RBI is now evaluating Tata Sons’ request for deregistration as well as its plea for exemption from listing requirements.

SP Group’s Debt

The SP Group, one of India’s oldest businesses, has been going through financial pressure. The group operates in construction, real estate, infrastructure, and engineering sectors. Many of these were impacted due to the COVID-19 pandemic. The crisis affected cash flow and made the group debt burden.

To tackle its debt crisis, the SP Group has started selling assets like sale of majority stake in Eureka Forbes, divestment of Sterling and Wilson Solar to Reliance Industries and listing of Afcons Infrastructure and sale of Gopalpur Port.

The SP Group is also raising $3.3 billion from global banks and credit funds. It has pledged its entire 18.37% stake in Tata Sons to private credit funds to secure financing.

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