Tata Motors Demerger: CV PV Businesses Listed Into Separate Entities

Tata Motors’ board has accepted the proposal to split the firm into two publicly traded entities. According to the company’s statement, the demerger would result in two companies: commercial vehicles (CV) and passenger cars (PV).

According to the company’s official statement, the demerger will be carried out under an NCLT plan of arrangement, and all TML shareholders will retain an identical shareholding in both listed firms.

Further the statement added, ” The demerger is a logical continuation of the subsidisation of PV and EV businesses that occurred earlier in 2022, and it will allow the respective businesses to pursue their individual plans to produce higher growth with greater agility while reinforcing responsibility. Furthermore, while there are limited synergies between Commercial Vehicles (CV) and Passenger Vehicles (PV) businesses, there are significant synergies to be harnessed across PV, EV and JLR, particularly in the areas of EVs, autonomous vehicles, and vehicle software, which the demerger will help secure.”

Tata Group chairman N Chandrasekaran stated that the company’s three automotive business segments are now operating independently and producing consistent results. He stated that the demerger will allow the three companies to take advantage of opportunities with greater focus and agility.