SP Group Nears Tata Sons Stake Monetization Talks – Deal Heat Rises

Mumbai’s corporate chessboard just got hotter. SP Group—the silent heavyweight in Tata Sons’ cap table—is reportedly gearing up to unlock value from its stake. No more passive holding; the game’s afoot.

Why now? With Tata’s digital arms sprinting toward IPOs and legacy divisions spinning off, SP smells liquidity. Sources whisper the group’s ready to negotiate—but won’t fire-sale its golden ticket.

Behind the scenes: Tata’s bylaws still mandate board approval for stake transfers. SP’s move? A calculated play to pressure without rattling the cage. Classic high-stakes poker.

Cynic’s corner: Because nothing says ‘trust the process’ like billionaires monetizing paper gains while retail investors hold the bag.

Steps to reduce debt

The SP Group, with a stake of 18.37 per cent stake in Tata Sons, is the single-largest minority shareholder. The SP Group is looking to reduce its indebtedness by monetising its stake.

The SP Group’s flagship Shapoorji Pallonji and Company Private Limited’s consolidated debt reduced to ₹20,000 crore as on March 31, 2024, from ₹37,000 crore in 2020 and it is attempting to reduce it further through strategic divestments in group firms.

The SP Group recently received time till June 2028 from the Reserve Bank of India (RBI) for its investment arm Sterling Investment Corp to meet its capital adequacy norms. This means that the SP Group can go ahead with its $3.4 billion private credit deal without any increase in yields.

Sour past

Earlier this week, Tata Trusts, which holds over 66 per cent stake in Tata Sons, directed the latter to remain unlisted but also provide an exit to the SP Group and explore all options.

The elevation of Noel Tata, who is related to the SP Group by marriage, as chairman of Tata Trusts, has paved the way for better cooperation between the two groups. Relations had soured when Cyrus Mistry had been the chairman.

Tata Sons was categorised as a Core Investment Company and placed in the upper LAYER NBFC in 2022 by the RBI and under regulations has to be listed by the end of September this year. The holding company of the group has no desire to be listed and has applied to the RBI for voluntary surrender of the Certificate of Registration as a CIC and to continue as an ‘Unregistered CIC,’ in accordance with the prescribed procedure.

“The application is under examination by RBI,” it said in its latest annual report.

Published on July 31, 2025