| Thursday, February 01, 2007 |
| Moment of pride as Tata finally bags Corus |
Corus has been won, finally, by India's own Tatas. The Tata group has sealed the deal to have complete control over Anglo-Dutch steelmaker Corus by pushing behind Brazilian giant Companhia Siderurgica Nacional (CSN).
Wednesday's drama ended with the Tatas winning with a bid of 608p a share in cash, against CSN's bid of 603p a share. The Tata bid valued Corus at about £6.7bn including debt, said reports.
The deal has made Tata the word's fifth biggest steelmaker. Chairman Ratan Tata, expressing satisfaction, said that the deal would be the first step in showing that Indian industry can in fact step outside the shores of India in an international market place and in fact acquit itself as a global player, said a report.
With the steel industry on a consolidating mode across the globe, steel manufacturers have been under tremendous pressure to grow. Mittal's Acelor acquisition had given this an added impetus.
With the deal sealed, Tata swung back to real business. The group has forecast cost savings of $ 350m a year through the combination of the Asian and European groups. It also said that procurement and marketing could be areas where savings could be made, and shipping of low-cost steel from India for finishing at Corus' plants in the UK.
The new entity is seen as a strong and robust platform that could help stakeholders. It may be recalled that at the time of its near-collapse four years ago, Corus shares were trading at less than 10p, but a boom in global steel prices and a restructuring had led to a dramatic recovery later on.
Meanwhile analysts are busy questioning the amount Tata had to pay. Saying that Corus was an expensive buy at 515 p a share, a 450 p was where a stand-alone fair value was. More than the money, it was pride at play as far as the Tata-CSN was concerned.Labels: Business |
| posted by a correspondent @ 9:46 PM |
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