Tata Group on Wednesday said it was transferring all its branded food businesses from Tata Chemicals Ltd (TCL) to Tata Global Beverages Ltd (TGBL) in order to bring its consumer businesses under one unit. Here are the 10 things you should know about this restructuring by the Tata Group:
1) After the transfer of Tata Chemicals’ consumer business, Tata Global Beverages will be renamed Tata Consumer Products Ltd.
2) Apart from Tata Salt and Tata Sampann, which sells spices, pulses and snacks, the demerger will also see the transfer of Tata Dx, a detergent powder, to Tata Global.
3) Tata Consumer Products will see a turnover of Rs 9,099 crore (25% more than that of Tata Global), with earnings before interest, tax, depreciation and amortisation (Ebitda) of Rs 1,154 crore.
4) Tata Chemicals will see its revenue decline by 15% to Rs 10,336 crore.
5) Under the demerger process, 114 shares of Tata Global will be issued for every 100 shares of Tata Chemicals.
6) The transaction values the consumer business of Tata Chemicals at around Rs 5,800 crore.
7) Tata Chemicals will continue to manufacture Tata Salt, but the brand will be owned and marketed by Tata Consumer.
8) The transaction is subject to the necessary statutory and regulatory approvals from the National Company Law Tribunal, stock exchanges, Securities and Exchange Board of India (Sebi) and respective shareholders and lenders/creditors of each of the companies.
9) The transaction is likely to be completed by the first quarter of FY21.
10) Bank of America Merrill Lynch advised Tata Global on the deal, while Tata Chemicals was advised by JP Morgan.
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