Tata Sons pledges shares in 3 more large group cos

A day after three major Tata Group companies - Tata Steel (TATASTL.BO), Tata Power and Tata Teleservices (Maharashtra) Ltd - said that their promoter Tata Sons has pledged shares in these companies to raise funds, Tata Motors (TATAMOTORS.BO), in a filing on the National Stock Exchange (^NSEI) (NSE) said Tata Sons has pledged 3.72 crore shares, or 8.15% of the total equity capital held by the promoter. Tata Sons Ltd held 28.58% in Tata Motors. As per the closing price of Tata Motors shares on Tuesday on the Bombay Stock Exchange (^BSESN) (BSE) on Tuesday, the value of the total number of shares pledged is Rs 516.52 crore. The shares of Tata Motors closed at Rs 138.85 on the BSE on Tuesday, down by 1.84%.

Tata Motors has been recently in the news for a number of reasons, including sluggish sales of vehicles leading to its first losses in seven years. For the third quarter (Q3'09), Tata Motors had posted a net loss of Rs 263.26 crore as compared to a net profit of Rs 499.05 crore in the same period last year. The company has also been finding it difficult to raise funds for the much-touted the Jaguar Land Rover (JLR) acquisition last year. It is yet to raise $2 billion of the total $3 billion bridge loan taken by it for the JLR acquisition. The company has already paid back $1 billion of the bridge loan. It has recently said it is in talks with various banks to raise the $2 billion. Last week, it hinted at a possible delay in payments to its vendors and suppliers. The company is also facing a tough situation relocating its Nano project from Singur in West Bengal to Sanand in Gujarat, owing to issues over land acquisition in Singur.

Other Tata companies that also saw promoters pledging their shares were Indian Hotels Company (IHCL) and Tata Coffee. IHCL said promoter Tata Sons has pledged 2.50 crore shares representing a 3.46% stake in the company, while Tata Coffee said its main promoter Tata Tea Ltd (TATATEA.NS) has pledged 107,35,982 shares representing 57.48% stake in the company.

To check recurrence of a Satyam (SATYAM.BO)-like situation, where the promoters had pledged shares in the company, market regulator Sebi had decided to make it mandatory for promoters (including promoter groups) of companies to make full disclosures if they pledge shares. Sebi has mandated the disclosure of the pledged share as part of their quarterly earnings from March quarter onwards.