Tata Power sells its Defense business to Tata Advanced Systems Limited for Rs 2,230 crore
On Wednesday, Tata Power India's largest integrated power company in Mumbai announced that its board has approved the sale of its Defense business to Tata Advance Systems Limited, a wholly owned subsidiary of Tata Sons at an enterprise value of Rs. 2,230 Crore (out of which Rs 1,040 crore payable at the time of closing and Rs. 1,190 crore payable on achieving certain milestones). The deal needs government and other approval. This is company's strategy to monetize its non-core assets and improve the balance sheet. It needs shareholders approval.
Mr. Anil Sardana, CEO & Managing Director, Tata Power said "SED is a non-core business division of Tata Power. The Company has been working on charting its next phase of growth, for which monetization of non-core assets is a critical step. This sale will also help in reduction of leverage."
He further added, "Strategic Engineering Division (SED) is a non-core defence electronics division of the Company, engaged in business of indigenous design, development, production, integration, supply and life cycle support of mission critical defence systems."
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The key products include manufacturing and assembling missile launchers, electronic warfare, night vision systems and gun systems. The division has been awarded programs of national importance such as (i) Missile Launchers: Pinaka MBRL / Akash Launchers for Army & Air Force (AAFL & AAL) / Strategic Missile Launcher / MR-SAM Launchers, (ii) Electronic Warfare (iii) Modernization of Airfield Infrastructure (MAFI). SED has three dedicated manufacturing units viz. Bangalore Electronic City, Vemagal in Karnataka (under construction) and a SEZ near Bengaluru (under construction).
Shares of TATA POWER CO.LTD. was last trading in BSE at Rs.79.35 as compared to the previous close of Rs. 80. The total number of shares traded during the day was 311940 in over 1440 trades.
The stock hit an intraday high of Rs. 80.35 and intraday low of 78.8. The net turnover during the day was Rs. 24890496.