TCS eyes overseas listing, to expand board

Currently, TCS has three directors on the board — Tata himself, TCS MD and CEO S. Ramadorai and Aman Mehta.

Addressing a news conference, Tata said the funds from the IPO would be utilised for restructuring the Tata Sons balance sheet and to help continue the work the company has been doing. ‘‘Tata Sons has been only doing the work of promoting new companies in the group, and that will continue along with increasing shareholdings in companies over time. This inflow of cash would contribute to continuing what we have been doing,’’ Tata explained.

The IPO is likely to fetch anywhere between Rs 4,940 crore and Rs 5,740 crore. The entire money would be going to Tata Sons. TCS is currently a division of Tata Sons and post-IPO, it would stand as a separate company with the latter still retaining 86.91 per cent stake in it.

As to why TCS, despite sitting over the IPO for several years, chose this time to take the plunge, Tata said, ‘‘We came to the conclusion that at this stage, TCS would benefit by going public since it would become a corporation on its own instead of being a division of a private company’’.

On whether there would be a differential pricing for the employees of TCS, Hussain said would not be the case. He explained that the transfer of Tata Sons assets to TCS for the purpose of creating the separate corporate entity for TCS would require TCS to pay Rs 2,300 crore to Tata Sons. This would also come from the issue proceeds.

Of the 55,452,600 equity shares of Re 1 each being offered, the company is making a fresh issue of 22,775,000 shares, while the remaining 33,677,600 shares are on offer for sale by Tata Sons Ltd and other shareholders of the company.

There would also be a greenshoe option of 8,317,880 equity shares of Re 1 each to be offered by Tata Sons aggregating between Rs 644.6 crore and Rs 748.6 crore.