Tata Motors gets NCLT's approval to make its PV business a separate entity

Now that the PV division is separated, the company can sell the stakes to strategic partners. It will help them in long-term viability as an overall business reorganisation plan to achieve growth and development of the PV unit, they had to divert the business, said the company.

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Image source: Tata Motos Twitter

The Indian carmaker Tata Motors got approval from the National Company Law Tribunal's Mumbai bench to divert its passenger vehicle (PV) unit into a different unit. In a filing exchange, the company said that with references to the letters regarding the scheme arrangement of 27 March 2020, 31 July 2020, and March 5, 2021, the company was pleased to announce that NCLT vided the sanction of the scheme in its order of 24 August 2021.

The company is said to be filing the same order plus the copy of the scheme with the registrar of the companies in Mumbai within 30 days of receipt. Now that the PV division is separated, the company can sell the stakes to strategic partners. It will help them in long-term viability as an overall business reorganisation plan to achieve growth and development of the PV unit, they had to divert the business, said the company.

In February 2021, Tata Motors got the sanction to transfer its PV unit to TML Business Analytics Services. The company will rename the unit as Tata Motors Passenger Vehicles (TMPVL) later on. As per the reports, a notice to the company's shareholders stated that the PV division had incurred the loss of Rs. 11,173 crores by the end of June 2020 and, the fixed valuation is Rs. 9,417 crores. This step is crucial for the PV division to secure strategic partners who provide new-age technologies, architecture, capital ad much more.