Tata Son''s newly formed financial subsidiary Tata Capital also made its first investment in that space. According to sources Tata Capital has bought 36 per cent stake in Precision Camshaft from Actis Private Equity for $9 million.
Solapur based Precision is an auto components company with revenues close to Rs 400 crore. It has 85 per cent market share and supplies to clients like GM and Daimler Chrysler.Actis is exiting from the venture after 10 years. There is a strategic reason why Tata Capital has made this transaction. Tatas have big plans to grow their auto components business which is led by group company Taco. Taco was formed over 10 years ago but has not grown the way the Mahindras or Bharat Forge have. Taco has over 50 JVs which many feel can be restructured and investments by Tata Capital in the same space might help Tatas grow the business. Tata''s brush with financial services has been quite chequered. Its earlier avatar Tata Finance was caught violating SEBI guidelines and its boss was sacked. Then it became a part of Tata Motors and now it''s back on its own. Even though Tatas are yet to make any formal announcement, the fund might have Rs 1,500 crore corpus and will be focusing on smaller PE deals which will have synergies with Tata business interests.
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