Tata Motors Ltd. has set Sept. 1 as the official record date for its share capital reduction scheme, following approval from the National Company Law Tribunal's Mumbai bench, according to an exchange filing.
This announcement comes after Tata Motors' earlier announcement on Aug. 5, when the company informed stakeholders about the NCLT's sanctioning of the Scheme of Arrangement under Sections 230 to 232 of the Companies Act, 2013.
The scheme involves the reduction of the company's share capital by cancelling and extinguishing the 'A' ordinary share capital and issuing new ordinary shares as consideration.
Under the terms of the scheme, Tata Motors will issue seven fully paid-up new ordinary shares, each with a face value of Rs 2, for every 10 'A' Ordinary Shares of the same face value held by shareholders on the record date.
The company is in the process of filing a certified copy of the NCLT's order with the Registrar of Companies, Mumbai, to make the scheme effective. Once effective, the scheme will entitle holders of 'A' ordinary shares to receive the new shares as consideration.
This move is part of Tata Motors' ongoing efforts to streamline its capital structure and enhance shareholder value.
Shares of the company closed 0.97% lower at Rs 1,087.70 per share, compared to a 0.13% decline in the NSE Nifty 50. The stock has risen 75.29% year-to-date and 39.89% over the past 12 months.
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