The Tata Group should search for other funding options for Tata Steel in the United Kingdom, incorporating offloading its stake in Jaguar Land Rover, as its conversations with the UK government have failed to work out, as per reports.
Tata Group had approached the UK government for a bailout package for Tata Steel UK after a significant mishap inferable from the Covid-19 pandemic.
The organization had moved toward the government to infuse the funding as an end-result of a value stake of up to 50 percent to UK citizens, a SkyNews report in April asserted.
SkyNews had revealed that Tata Steel had moved toward the UK and Welsh governments looking for a £500 million bailout to help the industry, which is confronting a significant droop because of the pandemic.
JLR had likewise moved toward the UK government looking for £1 billion in government help, the British media had announced before.
The Financial Times detailed throughout the end of the week that the conversations had been severed after the British Treasury inferred that the Tata Group didn’t qualify for funding under its Project Birch.
The parent organizations will presently need to search for options. Business Standard revealed that the Tata Group may consider offloading its stake in JLR, citing a previous director of Tata Steel and Tata Motors.
“I will not rule out a stake sale in JLR and a complete sale of the UK steel operations,” the report cited him as saying. He further said that even the discussions with the ThyssenKrupp for the conceivable merger of Tata Steel’s European tasks was taking a great deal of time, which was “bad news” for Tata Steel.
Notwithstanding, the Tata Group has denied the report expressing that it doesn’t expect to offload its stake in JLR.
“Tata Motors categorically denies and dismisses any such intent. Jaguar Land Rover is and remains a key pillar of Tata Motors and the wider Tata Group. We recently announced our results for Q1 and have indicated that we are maintaining solid liquidity despite the Covid-19 pandemic and expect to be cash positive from Q2 onwards.
Jaguar Land Rover business remains strong as it transitions to new electrified, autonomous and connected technologies to support its Destination Zero ambition,” the company said in an official statement.