Tata Steel to buy Aussie mining co

JAMSHEDPUR: Tata Steel has finalised a plan to buy into a coal mine in Australia, as part of a larger strategic plan to scout for global opportunities to secure raw material linkages, post acquisition of Anglo Dutch steel company, Corus.

Addressing his first-ever press conference in Jamshedpur on Saturday, Mr Ratan Tata, chairman of Tata Group, said: “We are looking at how we can align ourselves with Corus and buy into or partner with coal and iron ore producers to meet our needs.

With Corus, our plan has now acquired global components. We have put in a proposal for a coal mine in Australia. We are scanning for possibilities elsewhere across the world too.”

Responding to a wide range of queries on the recent Tata-Corus deal and its larger implications, Mr Tata added: “We are also looking at how Corus can improve its competitiveness in accessing raw materials, not from offtake form us but from our connections globally.”

Incidentally Tata Steel already has minority stake in a coal mine in Queensland, Australia. Mr Tata was in Jamshedpur to attend the annual founder’s day celebrations of Tata Steel.

However, this year Jamsetji Nusserwanji Tata’s birthday on March 3 has a special meaning since 2007 is also the company’s centenary year. To add to this, Corus chairman, Jim Leng and its chief executive, Mr Philippe Varin have both come down from London to attend the celebrations.

Mr Tata said Corus is expected to come into the Tata fold by early April. “Tata Steel hopes to the owner of Corus by early April, if the shareholders accept our bid in a meeting next Wednesday (March 7). Following this, Corus will be delisted and become a subsidiary of Tata Steel,” he added. The Corus stock will be held by Tata Steel (UK), a subsidiary floated for the purpose.

The two entities Tata Steel and Corus will exist side by side and there are no plans to merge the two as of now. “We have formed an Integration Committee, headed by me, for the day to day management of the combined entity.

The committee has representatives from both companies and will operate as the shadow board and look at the two companies as a virtual single company,” Mr Tata said. Justifying the price of 608 pence per share that Tata Steel agreed to pay for Corus, Mr Tata said: “While we had to pay a higher price than expected, I think history will say we did the right thing.”

rakhi.mazumdar@timesgroup.com