The Board of Tata Capital, the major financial services unit of Tata Sons, has approved changes in its Memorandum of Association as per the provisions of the Companies Act 2013 and adopted a new set of the Articles of Association (AOA). These changes are being made under the company’s list of listed in the end of this year.
In the information released on Thursday for Postal Bellet, the company said that as an NBFC (non-banking financial company), he is subject to rules related to capital adequacy. It said, ‘The company will continue to increase its debt portfolio and asset base, so it will require additional capital to meet the necessary capital adequacy ratio in relation to its business. Keeping this in mind, the company can raise additional capital from time to time through the rights issue.
The Tata group has not responded to the email message sent in this regard on Wednesday.
As per the Companies Act, 2013, Section 25 defines ‘deemed prospectus’, according to which any document used to offer securities for public sales is considered a prospectus, with which all legal implications Are connected. On the other hand, Section 42 controls the process of ‘private placement’, which allows companies to raise capital by introducing securities to investors without public offers.
Both Tata Capital and Tata Sons have been tagged by the Reserve Bank of India as an upper level NBFC, making it mandatory for both companies to be listed by September this year.
Currently, Tata Capital holds Tata Sons stake in Tata Capital 92.83 percent, Tata Group companies hold 2.46 percent, IFC (International Finance Corporation) holds 1.91 percent and Employee Welfare Trust holds 1.16 percent, while the remaining 1.64 percent stake is with others.