Tata Motors Offers 23% Bonanza to Shareholders Today

Tata Motors cancels 'A' ordinary shares and offers a swap with ordinary shares, providing up to a 23% bonanza to current 'A' shareholders

The move aims to simplify and consolidate Tata Motors' capital structure, reducing the total number of equity shares by 4.2%

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Shareholders with 10 'A' ordinary shares will be issued 7 ordinary shares as compensation for the reduction

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The swap ratio offers a 23% premium to Tata Motors DVR shareholders over the share price difference at Tuesday's close

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The spread between the two share types is currently around 20%, favoring 'A' ordinary shares, but new buyers may not benefit from this difference

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Tata Motors 'A' ordinary shares opened with a 15% gain, narrowing the spread

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Nuvama research suggests two scenarios: unwind positions and book profits if the spread narrows to 8-10%, or set up fresh positions around a 15% spread over the coming 12-14 months

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Tata Motors offers DVR shares with one-tenth of voting rights but 5 percentage points higher dividend than ordinary shares

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Tata Motors' capital restructuring scheme is subject to regulatory approval

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The scheme includes the establishment of a trust, with an independent third party as trustee, to execute the required actions in compliance with applicable laws

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Tata Motors cancels 'A' ordinary shares and offers a swap with ordinary shares, providing up to a 23% bonanza to current 'A' shareholders

Credit by - google

The move aims to simplify and consolidate Tata Motors' capital structure, reducing the total number of equity shares by 4.2%

Credit by - google

Shareholders with 10 'A' ordinary shares will be issued 7 ordinary shares as compensation for the reduction

Credit by - google

The swap ratio offers a 23% premium to Tata Motors DVR shareholders over the share price difference at Tuesday's close

Credit by - google

The spread between the two share types is currently around 20%, favoring 'A' ordinary shares, but new buyers may not benefit from this difference

Credit by - google

Tata Motors 'A' ordinary shares opened with a 15% gain, narrowing the spread

Credit by - google

Nuvama research suggests two scenarios: unwind positions and book profits if the spread narrows to 8-10%, or set up fresh positions around a 15% spread over the coming 12-14 months

Credit by - google

Tata Motors offers DVR shares with one-tenth of voting rights but 5 percentage points higher dividend than ordinary shares

Credit by - google

Tata Motors' capital restructuring scheme is subject to regulatory approval

Credit by - google

The scheme includes the establishment of a trust, with an independent third party as trustee, to execute the required actions in compliance with applicable laws

Credit by - google