Shareholders to vote on Tata Motors and Tata Motors DVR merger proposal today

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The vote on the merger proposal of Tata Motors and Tata Motors DVR will be held today as announced by the board of directors in July 2023.

The company said that it will issue seven (Ordinary) shares of Tata Motors per 10 Tata Motors DVR (A Ordinary) shares, which will stand cancelled.

As on Thursday (April 25), Tata Motors DVR shares traded at a nearly 43% discount to Tata Motors shares.

The merger ratio translates to a 30% discount to Tata Motors shares and significantly below its historical averages.

It will lead to a reduction in the outstanding equity shares by 4.2%, gradually increasing the price for shareholders.

Tata Motors first issued DVRs in 2008 and more of them in 2010 via qualified institutional placement (QIP) and some more through a rights issue in 2015.

However, regulatory changes have since restricted the issuance of such instruments with DVR and Tata Motors remains the only large listed corporation with such an instrument.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow