Home / Companies / News /  Tata Sons raises stake in Tata Motors ahead of EGM

Mumbai: Tata Sons Ltd, the Tata group holding company, on Tuesday bought 50 million shares of Tata Motors Ltd in a bulk deal for Rs2,430.65 crore, National Stock Exchange (NSE) data showed.

Tata Sons bought shares at Rs486.13 each, a 7% premium to Monday’s closing price of Rs454.4. Tata Motors shares closed at Rs470.35 on Tuesday. With this acquisition, Tata Sons now holds 28.71% stake in the car and truck maker, from 26.98% earlier.

Morgan Stanley was the investment banker for the transaction.

ALSO READ:Tata Motors shares gain 3.5% on block deal

The move is aimed at gaining an edge in the upcoming extraordinary general meeting (EGM), said an analyst, on condition of anonymity. The 22 December shareholder meeting has been called to remove Cyrus Mistry, ex-chairman of Tata Sons and Nusli Wadia as directors from the board of the automaker.

In its notice to shareholders, Tata Motors had said that 15 December was the record date for the EGM. That means only holders of shares as on that date are eligible to vote at the EGM.

According to company law, the resolution requires 51% of those shareholders present and voting to pass the resolution.

ALSO READ: Possible scenarios for Tata Sons, Mistry as shareholders begin to vote from today

At the end of September, promoters hold 33% stake in Tata Motors and apart from Tata Sons, Tata Steel Ltd holds 2.9% and Tata Industries Ltd holds 2.5% stake.

Foreign institutional investors hold 26.11% stake while Life Insurance Corp. Of India and mutual funds hold 5.2% and 4% stakes in the company respectively, according to the shareholding pattern data on BSE.

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