Tata Sons to Acquire Majority Stake in Tejas Networks

Tata Sons plans to acquire 63.1% stake in Tejas Networks. The company also plans to gain access to crucial 4G and 5G telecom gear tech with this acquisition.

Tata to Buy Majority Stake in Tejas Networks

Saurabh Agrawal, Executive Director, Tata Sons Private Limited, said, "we are excited to partner with Tejas Networks, India’s leading telecom and network company with a strong DNA of R&D. We look forward to working with the highly experienced management team of Tejas Networks and creating a full stack of globally competitive wireline and wireless products".

V Balakrishnan, Chairman, Tejas Networks, added, "we are delighted about our association with the Tata group, which has a long history of building highly successful global businesses of scale. This association provides us the necessary financial resources, global relationships and strong ecosystem to innovate and scale our business".

Tatas have signed an agreement to acquire 43.35% of Tejas, for ₹1,850 crore. The telecom gear maker is a veteran of the industry; it also remains among the earliest gear makers to build local products in networking and optical backhaul. Tata will acquire the said share in Tejas Networks via its subsidiary Panatone Finvest Ltd.

The official statement further read, "Panatone and other certain companies of the Tata group would make a Public Announcement to acquire up to 4.03 crore equity shares of Tejas Networks representing 26% of the emerging voting capital in accordance with SEBI Takeover Regulations".

Kotak Mahindra Capital Company Limited is acting as the manager. Also, Khaitan & Co is acting as the legal advisor to the transaction. Also, Sanjay Nayak, CEO and Managing Director at Tejas will continue to lead the company.

Great Market Opportunity for Tejas

Tejas Networks are looking at a huge opportunity in telecom in both India and abroad; 5G and fiber-based broadband rollouts present a lucrative market. The gear maker has said that it will channel the money it raises in various departments; that means the R&D, sales and marketing, people, infrastructure and manufacturing capabilities will see money put in them. Tejas said that it will also target a larger market with the proceeds raised from the sale.