ibusinesslines.com March 18, 2018

Tata Sons to sell 1.48% stake in TCS, raise Rs8,500 cr

13 March 2018, 10:03 | Kelvin Horton

At 1.05 pm TCS shares were trading 4.68% lower at Rs2,903.50 on the BSE

At 1.05 pm TCS shares were trading 4.68% lower at Rs2,903.50 on the BSE

Almost 2.06 crore shares were offloaded at a price of Rs 2,876.46 apiece.

Shares of Tata Consultancy Services (TCS) tanked over 5 per cent on Tuesday on news reports that Tata Sons, the promoter of major operating companies of the Tata group, is planning to raise around Rs 8,200 crore by selling stake in IT major.

According to Bloomberg, Tata Sons was offering 28.27 million shares of Asia's largest software developer after the market closed on Monday, planning to sell the shares between Rs 2,872 to Rs 2,925 a share.

Consumer price index (CPI) or retail inflation eased to 4.44 per cent in the month of February 2018, from 5.05 per cent in January 2018, slightly in line with analysts expectations. On the other hand, a "block deal" is a transaction of over 500,000 shares - or a minimum value of Rs 5 crore - executed through a single transaction. Citigroup Inc. and Morgan Stanley are the bankers to the sale.

On the BSE, 15.51 lakh shares were traded in the counter so far compared with average daily volumes of 72,000 shares in the past two weeks.

In addition, the holding company is seeking a $1.5 billion offshore syndicated loan, to pay down expensive debt at its telecommunications unit. The Group is clearly in a hurry to exit its troubled mobile telephony business.

The money raised from the stake sale will be used by Tata Sons to strengthen its balance sheet, reports added.

Tata Sons had 73.5% stake in the software company at the end of December 2017. TCS is the most-profitable unit within the $100 billion-plus Tata Group, and ranks among the top three most valuable brands in the global IT services sector along with IBM and Accenture.

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