Tata Motors (TML), India's largest automobile company and leader in commercial vehicles across segments has completed the transfer of its defence business with effect from Apr.01, 2021 to Tata Advanced Systems (TASL) for an upfront consideration of Rs 2,277 million (which is subject to closing balance sheet adjustments). The transfer has been completed through a slump sale as per Scheme of Arrangement approved by National Company Law Tribunal at Mumbai and Hyderabad.TML has been in the defence sector for several decades, and currently has a wide portfolio of logistics, combat support and armoured vehicles for the defence, paramilitary and state police forces.

Tata Motors also exports its range of defence vehicles to SAARC, ASEAN, and African nations. TASL, a wholly owned subsidiary of Tata Sons is focused on providing integrated solutions for aerospace, defence and homeland security.

The sale of Defence business to TASL is in line with Tata Group’s strategy of consolidating the defence businesses under a single entity to bring scale and synergy. TML will continue to play a significant role in the value chain by supplying chassis and aggregates to TASL for developing specialized defence applications, while continuing to supply pure civilian PVs and CVs to defence forces directly.

TASL will invest in enhancing design & development capabilities for expanding the global footprint and providing specialist, high value-added, futuristic solutions to defence customers in and outside India. The consolidation will yield benefits in the form of operational and financial synergies helping deliver better value for both the entities.

Over the next several months, TML and TASL will work closely to ensure smooth transition of the defence business.

Shares of the company gained Rs 2.6, or 0.85%, to settle  at  Rs 307.65.  The total volume of shares traded  was  5,334,296 at  the BSE (Tuesday).