Tata Advanced Systems Limited (TASL) has concluded its acquisition of Tata Motors’ defence business, the latter firm has announced on the Bombay Stock Exchange.
A filing said the acquisition, which was finalised on 1 April, is valued at INR2.277 billion (USD31 million) and was paid through an ”upfront” lump sum consideration.
The sale includes Tata Motors’ portfolio of logistics vehicles, combat support vehicles, and armoured vehicles for defence, paramilitary, and law enforcement applications.
Tata Motors has sold its defence business, which produces a wide range of military vehicles such as this LPTA 715 4×4 utility truck, to its sister firm Tata Advanced Systems Limited. (Tata Motors)
For the military domain, Tata Motors has also developed in recent years several platforms including amphibious fighting vehicles, mine-protected platforms, and multirole vehicles.
The filing said Tata Motors has supplied its military vehicles to Indian and export customers for several decades and is partnered on “various strategic programmes” including those in India to produce BrahMos cruise missiles and Agni ballistic missiles.
An agreement to support TASL’s acquisition was announced in May 2018. As part of the agreement, TASL also acquired Tata Motors’ aerospace subsidiary – named TAL Manufacturing Solutions – in March 2020 for INR6.25 billion.
The Tata Motors filing said the sale of its defence business to TASL is consistent with the Tata Group’s strategy of consolidating its defence activities under a single entity to encourage the expansion of scale and the improvement of synergies.
Accordingly, it said, the sale to TASL will “yield benefits in the form of operational and financial synergies helping deliver better value for both the entities”.
Looking to read the full article?
Gain unlimited access to Janes news and more...
