March 29, 2018
Tata Power sells its defence business to Tata Advanced Systems, a wholly owned subsidiary of Tata Sons
National: Tata Power, India’s largest integrated power company, today announced that its Board has approved the sale of its defence business to Tata Advance Systems, a wholly owned subsidiary of Tata Sons at an enterprise value of Rs2,230 crore (out of which Rs1,040 crore payable at the time of closing and Rs1,190 crore payable on achieving certain milestones), subject to Government and other approvals. This is as part of the company’s plan to monetise its non-core assets and improve the balance sheet. This will be subject to shareholders approval.
Speaking on this sale, Anil Sardana, CEO and 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 monetisation of non-core assets is a critical step. This sale will also help in reduction of leverage.”
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. 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:
- Missile launchers: Pinaka MBRL / Akash Launchers for Army & Air Force (AAFL & AAL) / Strategic Missile Launcher / MR-SAM Launchers,
- Electronic Warfare
- Modernisation of Airfield Infrastructure (MAFI). SED has three dedicated manufacturing units viz. Electronic City in Bengaluru, Vemagal in Karnataka (under construction) and a SEZ near Bengaluru (under construction).