Mistry had been in talks with Tata Sons chairman N Chandrasekaran and Noel Tata on the stake monetisation until July. Chandrasekaran announced in early August that he would not seek reappointment after his term ends in February 2027 and has not taken part in further discussions, according to executives aware of the situation.
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Progress in talks has been limited due to differences over the structure and valuation of a potential deal. One proposal involved SP Group receiving shares in a basket of listed Tata companies in exchange for part of its Tata Sons stake.
The latest buyback proposal aims to provide SP Group with cash proceeds over a defined period while allowing Tata Sons to maintain its private company status, which Noel Tata wants to preserve. Details on valuation, funding, quantum, and timing of any buyback are yet to be finalised.
The discussions come as SP Group faces pressure from lenders following a ₹21,500 crore refinancing completed in July. The group’s borrowing costs currently stand at 18-19%, which it aims to reduce to 12% through future refinancing.
SP Group has repayments of around ₹3,500 crore due by the end of September. Lenders want to see tangible progress in monetising the Tata Sons stake before considering further refinancing or relaxing loan-to-value requirements, sources said.
Failure to make the September payment could be treated as a default. This obligation relates to an earlier financing arrangement and was expected to be met from proceeds of the July funding.
