17,000 crore IPOs! Tata Capital’s De-Saint Debut Plan now survives on NCLT node for merger with Tata Motors Finn

Financial services company Tata Capital, with the company, is likely to file initial papers to collect $ 2 billion (US $ 17,000 crore) by the initial public offer (IPO) only after receiving NCLT’s final approval for Tata Motors Finance Merger.

Sources said that the final order from the National Company Law Tribunal (NCLT) is awaited, which is expected to close by the end of this fiscal year (FY 25), sources said.

An email sent to Tata Capital for filing draft papers remained unanswered.

The Reserve Bank of India (RBI) has approved its board to float the initial share sales to Tata Capital known as upper-layer non-banking finance company (NBFC).

According to an announcement in the stock exchanges, the offers will include 2.3 crore equity shares and some existing shareholders by a new issue in the proposed IPO.

Aside from the IPO, Tata Capital announced a plan to raise funds through issues of right to strengthen its financial position before the public list.

If successful, this will be the largest early stock of the country’s financial sector. The Tata Group’s second public market will also be admitted in recent years following the list of Tata Technologies in November 2023.

This step is part of the company’s efforts to comply with the RBI list requirements.

According to the RBI order, it is necessary to list the high-level NBFC as a high-level NBFC on the stock exchange within three years. Tata Capital was classified as upper-layer NBFC in September 2022.

Apart from Tata Capital, another high level NBFC HDB Financial Services owned by HDFC Bank is also ready to launch its IPO. Through initial stock sales, the company filed its draft papers in October to get 12,500 crores.

While the law company Cyril Emcharchand and Investment Bank Kotak Mahindra Capital Company have been introduced as advisors, the draft Red Harrowing Prospectus (DRHP) with SEBI will be introduced only after receiving the approval of NCLT on the proposed merger, sources said.

In Tata Motors’ Q3 Earnings Call Ll, Auto Maker group CFO PB Balaji said that the meeting of Tata Motors Finance creditors has been completed.

“The final order (is) waiting for the NCLT, and we expect it to close for this by the end of this financial year,” he said.

In September, the Competition Commission of India (CCI) cleared the proposed merger.

In June 2024, the board of Tata Capital, Tata Motors Finance and Tata Motors – the board of all three companies approved the merger of Tata Motors Finance with Tata Capital plans for NCLT configuration.

According to the merger, Tata Capital will issue its equity shares to Tata Motors Finance’s shareholders, resulting in Tata Motors effectively 7.7 percent of the merged entity.

Tata Sons is a holding company of Tata Capital, who owns 92.83 %.