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  • JUNE 10, 1999

Tata Ind. to net Rs 570 m from stake sale to IBM

Tata Industries stands to gain a minimum of Rs 570 m from the twin sale of its 50% sale in Tata IBM and 10% stake in IBM Global Services.

In the last week, Tata Industries pulled out of the two companies. Tata IBM Limited, was a JV between Tata Industries and IBM with each holding 50% of its Rs 960 m equity capital. Tata Industries also held 10% in IBM Global services whose equity capital in rupee terms is Rs 900 m. This brings the net investment of the Tatas in the two companies to RS 570 m.

Sources in the industry feel that the Tatas could get a valuation of at least 3 or 4 from the sell off. There has no comment on this by the Tatas. However, Mr. Dilip Pendse - Managing Director of Tata Industries did say that the money accrued from the divestment would be transferred to the investment reserve of Tata Industries.

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