Tata Coffee will officially merge with Tata Consumer Products Ltd (TCPL) on 1st January, following a reorganization plan aimed at unlocking synergies and efficiencies. Additionally, the scheme entails demerging Tata Coffee’s plantation business into TCPL Beverages and Foods and merging the remaining business with Tata Consumer Products, as a part of the strategic realignment.
The board of directors of TCL, the scheme implementation committee of TCPL’s board, and TBFL’s board have acknowledged the fulfilment of conditions under Clause 29, as stated by Tata Coffee.
On 28th December, both Tata Coffee and TCPL Beverages & Foods, another Tata group unit, experienced a surge, hitting their 52-week highs.
Tata Coffee and Tata Consumer Products Merger
As part of its reorganization plan to unlock synergies and efficiencies, Tata Coffee’s merger with Tata Consumer Products has received approval from the board of directors. All conditions, including the filing of certified copies with the registrar of companies in form INC-28, have been fulfilled.
Tata Coffee stated in an exchange filing that the Scheme will be effective on January 1, 2024, leading to the dissolution of the Company without winding up. Consequently, the office of all Directors and Key Managerial Personnel will stand vacated on that date.
The company has set January 15, 2024, as the record date to determine eligible shareholders of TCL who will receive shares in Tata Consumer Products following the demerger and amalgamation.
Tata Coffee and Tata Consumer Products Reach 52-Week Highs
On December 28, Tata Coffee and Tata Consumer Products shares surged to their 52-week highs at Rs 309.05. The shares concluded at Rs 308.4, marking a 1.41 per cent increase. Meanwhile, Tata Consumer Products stock settled near the day’s peak, reaching Rs 1,048.55 apiece, reflecting a 2.12 per cent rise.
Tata Coffee’s Demerger and TCL’s Merger Approved by Shareholders
The company highlighted that while the plantation business of Tata Coffee is set to be demerged into TCPL Beverages & Foods, the remaining business of TCL, comprising its extraction and branded coffee business, will merge with TCPL. Shareholders of Tata Consumer Products, Tata Coffee, and TCPL Beverages and Foods approved a restructuring proposal in a vote conducted in 2022. As part of the reorganization scheme, existing shareholders will receive one equity share in TCPL for every 22 equity shares held in Tata Coffee.