After reports that Tata Motors was looking to sell 49% stake in its passenger vehicle business, the automaker has denied the development, calling these reports unconfirmed and unsubstantiated. In a statement on Wednesday, Tata Motors clarified that all reports suggesting the same are incorrect and misleading, including the reports that has names of potential partners/investors
Tata Motors said that its products are receiving strong customer response and that over the years, initiatives taken by Tata Motors have and will continue to strengthen India and its auto sector.
In March 2020, Tata Motors had announced the intent to subsidiarise its PV business as the first step towards securing mutually beneficial strategic alliances that provide access to products, architectures, powertrains, new-age technologies and capital.
“Securing a mutually beneficial alliance is a priority. However, it is not an imperative for today but an opportunity to be secured for tomorrow. The imperative for today is to Win Sustainably by delivering market beating growth and positive free cash flows by delighting our customers with exciting products and exceptional service while continuing to drive a strong cost savings agenda,” the company said in a statement.
The statement was a response to reports that said that Tata Motors was looking to bring in a strategic foreign partner by selling 49% stake in its India passenger vehicle business for Rs 9,417 crore and that it would do so by transferring the unit into a wholly-owned subsidiary.
Reports claimed that the company was in talks with Chinese companies including Geely, Changan, and Chery and that the Indo-Chinese tensions then became a barrier to the deal.
Economic Times reported that Tata Motors was also talking to France’s PSA Group, and that the talks slowed on this front when PSA merged with Fiat Chrysler.
Tata Motors’ passenger vehicle business in India contributed 4% to the total turnover of the company in FY20.