After the Tata Sons’ financial intermediation unit Panatone Finvest purchased a stake from the government, Tata Group’s stake in Tata Communications increased to 58.87 percent.

As per regulatory filings, for an equity share of Rs.1,189.1962 amounting to Rs.3,389.2 crore, the government had sold a stake of 10 percent or 2.85 lakh shares in the digital solutions provider Tata Communications (TCL).

Previously the government of India owned 26.12 percent of the company, followed by Panatone Finvest with 34.80percent and Tata Sons with 14.07 percent and the public accounted for the remaining 25.01 percent.

Now with the current transaction, Tata Sons’ direct and indirect stake was able to rise to 58.87 percent. The government's nearly 20-year involvement in Tata Communications, formerly known as Videsh Sanchar Nigam Ltd (VSNL), will come to an end with the transaction.

A week prior to the current transaction, the government, which previously had 26.12 percent stake in Tata Communications, had sold 16.12 percent of its stake to retail and non-retail investors at a bargain of 1,161 floor price per equity share during an offer for sale (OFS). Although it received fewer responses from institutional investors, the OFS was subscribed 1.33 times. Overall, bids for 6.12 crore shares were received, compared to the 4.6 crore shares on offer. Despite the fact that the OFS's floor price was set at Rs 1,161, the majority of bids came in at Rs 1,184 and just 1.46 percent of the portion allocated for institutional investors was filled. Tata Communications' stock fell nearly 6percent percent to close at Rs 1141 on the BSE.

The sale of the government's entire stake in TCL netted the government Rs 8,846 crore.

“Through an off-market transfer, our Panatone Finvest Limited has acquired 2,85,00,000 equity shares valued 10 each of Tata Communications Limited (the target company) representing 10 percent of the total issued including paid up equity share capital of the Target Company from the President of India (as represented by and acting through the Ministry of Communications, Government of India)”, said Panatone Finvest.