Tata Steel hits 2.5 year high on merger buzz

NEW DELHI: Shares of Tata Steel hit a 2.5 year high of Rs 514.80 in Friday trade amid media reports suggesting that the merger of Tata Steel's European business' with German industrial group Thyssenkrupp AG may lead to potential savings anywhere in 400-600 million euros.

The two expect the merger of their European steel businesses would lead to annual savings of 400-600 million euros, said a daily, quoting a German magazine.

The two have been in talks over a deal since July, 2016 to cut costs and reduce over capacity, the report added. They came close to signing a memorandum of understanding (MoU). However, talks stalled due to Brexit and management reshuffle at Tata but it is reported, but the talks have since gained momentum, the report added.

The scrip of the steel company recorded an intraday high of Rs 514.80, and closed at Rs 511.80, up 5.46 per cent.

Neither Tata Steel nor Thyssenkrupp AG have commented on the report.

Tata Steel enjoys a market capitalisation of nearly Rs 50,000 crore.