Motors Ltd (TML) has spun off its passenger vehicles (PV) as well as its
electrical vehicle (EV) business into a separate subsidiary. The TML Board has
approved a plan to make the company’s PV as well as EV business a separate
subsidiary of TML through a scheme of arrangement.
making the PV and EV business a subsidiary of TML, it means that this new
subsidiary will get a new name and will operate as an independent company under
the parent company TML. The reason for creating a new subsidiary is that Tata
Motors hopes that it will help provide differentiated focus for the PV and CV
businesses and help each of them realise their potential.
according to the company, this decision is a first step in its plans to secure
mutually beneficial strategic alliances for the domestic PV business and help secure
its long-term viability.
TML Board also appointed Shailesh Chandra, President EV and Corporate Strategy
as president of the PV business including EV business with effect from April 1,
2020. Shailesh and Mayank will work on transition over the next few weeks and
Mayank will be superannuating from Tata Motors at the end of February 2021, the
company press release said.
TML Board has in-principle approved to subsidiarise TML’s PV business
(including EV) by transferring relevant assets, IPs and employees directly
relatable to the PV business for it to be fully functional on a standalone
basis through a slump sale. However, certain shared services and central
functions will be retained at TML to deliver cost efficiencies for the entire
proposed transfer shall be implemented through a scheme of arrangement, which
will be tabled for approval to the TML Board over the next few weeks.
Implementation of the scheme will be subject to regulatory and statutory
approvals as applicable, including approval of shareholders and creditors. The
company expects the transfer process to be completed in the next one year.
Tata PV business
the last few years, TML’s PV business has implemented a strong turnaround and
has earned its right to grow by launching a slew of successful products like
the Tiago, Tigor, Nexon, Hexa, Harrier and most recently the Altroz and Nexon
EV. A fully refreshed BSVI ready product portfolio based on the Impact 2.0 design
philosophy, consistently improving NPS scores, improved retail market shares
and an exciting entry into the EV space coupled with improved profitability
makes the business ready to realise its potential, the release added.
the recent outbreak of COVID-19 virus increases the challenges faced by the
business. In this situation our first priority is to secure the health and
safety of our people while continuing to serve our customers and securing the
viability of our ecosystem. Additionally, in sync with our strategy to “Win
Sustainably” we will take decisive steps to strengthen our business over the
long-term. A move towards subsidiarisation of the PV business is the first step
in securing mutually beneficial strategic alliances that provide access to
products, architectures, powertrains, new age technologies and capital,” the
for Shailesh Chandra, President EV and Corporate Strategy, he becomes the new President
PV business including EV with effect from April 1, 2020. “He will be assuming
responsibility for the PV business from Mayank Pareek. Shailesh’s appointment
at the start of the new financial year gives him the opportunity to shape the
organisation as we ready it to operate as a subsidiary once the necessary approvals
are in place. Shailesh and Mayank will work on transition over the next few
weeks and Mayank will be superannuating from Tata Motors at the end of February
2021. We would like to thank Mayank for his contributions in getting TML PV
business back on track to “Win Sustainably” and wish him well for the future,”
the release concluded.