The Tata Group, the largest private Indian company, is reportedly seeking to purchase India’s leading engineering and construction company, a move that could potentially open a lucrative global market for Indian companies.
According to the Indian Express, the Tata Group has asked the government of the state of Gujarat for permission to sell Tata Consultancy Services (TCS) and the Indian Railways (ILR) as it wants to increase its presence in the country.
The newspaper reported that the Indian government has denied the request, and said that the companies are “not for sale.”
A senior official with the state government said that “we are aware of the Tata group’s request to buy Tata Consultant Services and are evaluating it on its merits.”
The official said that it is unclear what the transaction would involve.
“The Tata Group intends to invest in the construction and engineering of its own projects, and not to take on projects that are not ready or have not been implemented yet,” the official told the Indian newspaper.
“We will decide how to allocate the assets of the company.”
According to a recent report by India Today, the government has asked TCS and the ILR to sell their assets.
“TCS and the other two entities are in the process of being privatized,” the report said.
TCS was acquired by the Tata Consultants Group in 2016, but was subsequently acquired by private equity firm TCS Private Equity Partners (TPGP), which also owns Indian Railway.
A report from the National Economic and Development Authority (NEDA) said in October that TCS should be sold.
“After the sale of TCS, TCS will be the largest listed company in India.
There will be a turnover of ₹3,000 crore.
We hope the government will ensure that TSC and ILR are sold in a fair and transparent manner,” the NEDA official told India Today.
“In this context, we need to ensure that the assets will be distributed in a manner that ensures transparency and fairness.”
In November, India’s prime minister Narendra Modi said that Tata Group and the rest of the private sector were looking to increase their presence in India, and had asked the state to give them the green light.
“There is a desire to expand the Indian economy to become a world player.
The private sector is ready to invest, but the government needs to act to protect the public interest,” Modi said at a press conference in New Delhi.
“This is the moment when private investors should invest in infrastructure, industrial parks and other industries,” he said.
The Tata group has reportedly been in talks with Indian government for over a year, and is reportedly ready to take over the two companies.
The Indian Express reported that India’s Cabinet Committee on Economic Affairs had approved the Tata-TGS deal, but that the government was yet to take a decision.
TGS, which is owned by Tata Consultancies Group, employs about 8,000 people in the state.
Tata Consult Services is a group of engineering and consulting firms, which also has a presence in several other countries.