Don’t see too many hiccups for Thyssenkrupp -Tata JV now: Rakesh Arora, Go India Advisors

The deal is important from long-term perspective because of consolidation of steel makers in Europe, Rakesh Arora, MD, Go India Advisors, tells ET Now.

Edited excerpts:

How do you read this prolonged play out of the Thyssenkrupp-Tata Steel joint venture? It is perhaps nearing a close and could be concluded within the next few days.

If the news is correct -- it has not been confirmed yet -- it will be positive for Tata Steel on two accounts. One is that there is no immediate cash outflow because Tata Steel’s balance sheet is getting stretched after all these acquisitions they have done in India already. To that extent, if there is no further cash outflow immediately, that is positive. A small reduction in their profit share does not really matter that much.

Number two, this deal is important from long-term perspective because of consolidation of steel makers in Europe. They have become the second largest steel company which gives them lot of pricing power. All in all, it is a positive step if they can conclude this deal on these terms.


After all these tweaking of the contours of the deal, could there still be a hurdle coming in or do you think it is paving the way for a green signal on this joint venture?

One of the bigger challenges was the labour at Thyssenkrupp which seems to have already given a go ahead to the deal. The management is already very keen. I do not see too many hiccups for this deal now.