HomeLatest NewsTata Steel will merge all group metal companies with itself; Board...

Tata Steel will merge all group metal companies with itself; Board approval; details

Tata Steel said its board of directors has approved the merger of all metals companies of the Tata group into it. There are seven metal companies that will merge with Tata Steel — Tata Steel Long Products, The Tinplate Company of India, Tata Metaliks, TRF, The Indian Steel & Wire Products, Tata Steel Mining, and S&T Mining Company.

The merger is subject to regulatory and other approvals. “Each scheme is subject to the receipt of approval from the relevant transferor company and the transferor company’s (a) requisite majority of shareholders; (b) Competent Authority, (c) SEBI (d) National Stock Exchange of India and BSE; and (e) such other approvals, permits and approvals of regulatory and other statutory or governmental authorities / quasi-judicial authorities as may be required under applicable laws,” according to a BSE filing.

It added that each merger scheme was reviewed and recommended to the board by the committee of independent directors and the company’s audit committee.

In a BSE filing, Tata Steel said the transaction would fall within the ambit of a related-party transaction as defined under listing regulations. TSLP is a listed subsidiary company of the company. “However, the transaction will not attract the requirements of Section 188 of the Companies Act, 2013, as per the clarification provided in General Circular No. 30/2014 issued by the Ministry of Corporate Affairs on July 17, 2014.”

Explaining the rationale for the merger, Tata Steel said, “The merger will integrate the businesses of TSLP and the transferee company resulting in focused growth, operational efficiencies and business synergies. Also, the resulting corporate holding structure will bring improved agility to the business ecosystem of the merged entity.”

Tata Steel is a leading global steel company, with over 100 years of experience in the steel sector and is a pioneer in steel production in India. TSLP is in the business of manufacturing and marketing of sponge iron, which is a single end use (steel making) and a single grade product. It has one of the largest specialty steel plants in India in the specialty bar quality category

Shares of Tata Steel were trading at Rs 105.20 apiece on the BSE at 12:04 pm (IST) on Friday, up 1.5 percent from the previous close. However, shares of the merged companies fell by up to 9 percent. Tata Steel Long Products was trading down 8.87 percent at Rs 682.45.

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