Daimler AG is selling its entire stake in India's Tata Motors Ltd. to raise up to $429 million worth of shares, sources familiar with the matter said.

Daimler is offering 25.6 million shares in India's largest vehicle maker at 737.4 rupees ($16.2) to 761.3 rupees each, which is 4 percent to 7 percent below the stock's close of 796.75 rupees, sources said.

The shares, which represent a 5.34 percent stake in the automobile firm, will be sold in the open market in block deals, a source with knowledge of the matter said.

"The book is just being built," he said.

The Tata group was not interested in buying the stake, Chief Financial Officer C. Ramakrishnan told Reuters.

"Daimler is selling the stake in the open market ... we are not involved ... I don't think any of the Tata Group companies are interested in the stake," he said.

Daimler owns 5.34 percent of Tata Motors' ordinary shares and 4.71 percent on a fully diluted basis. Media reports in India had earlier speculated that the German carmaker was looking to exit its long-held stake in Tata Motors.

A Daimler official declined to comment on the reported share sale and a Tata Motors spokeswoman did not have immediate comment.