Tata Sons Ltd’s shares pledged by the Shapoorji Pallonji (SP) Group are non-transferable, the Economic Times reported, citing Tata Trusts chief executive Siddharth Sharma.
Tata Trusts, which owns 66 percent of Tata Sons, are concerned about potential legal disputes with lenders if SP Group defaults on its payment obligations, the report said.
The SP Group, controlled by the Mistry family, has pledged its entire 18.37 percent stake in Tata Sons to secure funds from lenders.
While lenders are evaluating whether the shares can be pledged further, they are reassured by the fact that the shares have been pledged thrice before, the report said, citing people familiar with the matter.
Founded by Pallonji Mistry in 1865, the SP Group is one of India’s oldest conglomerates, with interests spanning real estate, construction, infrastructure, solar power, and services for the oil and gas sector. The group's close ties with the Tata Group soured after Cyrus Mistry was ousted as Tata Sons chairman in October 2016, leading to a protracted and bitter legal battle, which was decided in favour of the Tata group.
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