Tata Sons subsidiary Panatone Finvest Ltd has proposed to buy a 43.3% stake in Tejas Networks, a global optical, broadband, and data networking products company, for around INR 1,850 crore (USD 249 million) in a multi-step deal.
Tejas is among the earliest telecom product companies that have built homegrown technology products in networking and optical backhaul crucial for high-speed broadband.
Tata Sons, through its subsidiary Panatone Finvest Ltd, will acquire Tejas through a combination of equity and preferential issue through warrants, the companies said in a joint statement.
"Panatone and other certain companies of the Tata group would make a Public Announcement to acquire up to 40.3 million equity shares of Tejas Networks representing 26.00% of the emerging voting capital in accordance with SEBI Takeover Regulations," an official statement said.
The domestic telecom gear maker said that it sees a very large opportunity in the telecom sector both in India and global markets with the new cycle of investments in 5G and fiber-based broadband rollouts.
The company will use the proceeds from the preferential allotment to invest organically and inorganically in the research and development, sales and marketing, people, infrastructure and to enhance manufacturing and operational capabilities.
Saurabh Agrawal, Executive Director, Tata Sons, said: “We look forward to working with Tejas Networks and create a full stack of wireline and wireless products.”
Tejas Networks CEO and Managing Director Sanjay Nayak said the association with Tata group will accelerate the realisation of this vision and enable the company to address the large market opportunity available to us to build a financially strong global company, backed by a trusted brand.