AZB & Partners represented Tata Motors, a company with US 44 billion market capitalisation, for the restructuring involving demerger of their entire commercial vehicle business out of Tata Motors and merging the passenger vehicle business with Tata Motors
The reorganisation will result in creation of two listed companies with one housing the commercial vehicles business and other housing the passenger vehicles business.
AZB’s team comprised our Senior Partner Vaidhyanadhan Iyer, Partner Sneha Nagvekar, Partner Devika Nayak, Counsel Himaansho Tembe and Associates Priyasha Goyal and Shivani Shenoy.
They were supported by Partners Shivanand Nayak, Ruchit Parikh, Senior Associates Veeral Vakharia, Kshitez Kaushik, Jagmehar Saini, Prateek Jariwal and Harsha Uppal, along with Associates Aayushi Rout, Shloka Jain, Arya Madhani, Avani Laad, Mayukh Mandal, Roshni Shinde, Vedansh Tandon and Pratyush Chaturvedi on the due diligence aspects.
Partner Ajay Singh Solanki on the employment law aspects, and Partner Bharat V Budholia on the competition law aspects.
Tata Motors’ strategic demerger is designed to target $1 billion in revenue for each of its newly formed segments. Following the restructuring, Tata Motors will be split into two publicly traded entities: TML, which will focus on commercial vehicles and related investments, and TMPV, which will encompass passenger vehicles, electric vehicles (TPEM), JLR, and associated investments. The company projects that each of its eight distinct business segments will exceed $1 billion in revenue and profitability.
These segments include: heavy commercial vehicles; intermediate, light, and medium commercial vehicles; commercial vehicle passengers; international operations; TML Smart City Mobility Solutions; and digital and non-vehicular products (such as spares, fluids, and aggregates). After the demerger, these units will function as independent profit centers. Girish Wagh, Executive Director of Tata Motors, emphasized that with specialized teams for each segment, the company aims to enhance its focus on value creation by utilizing data to track metrics such as top-line revenue, profitability, return on capital employed, and cash flow.
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