The biggest Metal Merger is coming .Tata Steel Long Products, The Tinplate Company of India, Tata Metaliks, The Indian Steel & Wire Products, Tata Steel Mining, S & T Mining Company, and TRF are among the subsidiaries that have merged into Tata Steel.
Companies Which Are Merging
Tata Steel has announced the merger of its seven subsidiaries: The essentials of the mega-move In an effort to drive efficiencies and reduce costs, the Tata Group announced on Friday the merger of seven of its metal companies into Tata Steel.
The Tata Group announced the merger of seven of its metal companies into Tata Steel on Friday in an effort to consolidate its metal business in order to drive efficiencies ,reduce costs, streamline the group holding and management structure, consolidate, and strategically expand downstream engineering and operations.
According to a statement made by the steel giant, Tata Steel owns a majority stake in all of the subsidiaries, including Tata Steel Long Products (74.91% equity holding), The Tinplate Company of India (74.96%), Tata Metaliks (60.03%), The Indian Steel & Wire Products (95.11%), Tata Steel Mining Limited, and S & T Mining Company Limited (both wholly owned subsidiaries).
The board of Tata Steel also gave its approval to TRF’s (34.11%) merger with the company.
Swap Ratio For The Tata Steel Merger
- 67 shares of Tata Steel are needed for every 10 shares of Tata Steel Long Products.
- 33 shares of Tata Steel are needed for every 10 shares of The Tinplate Company of India.
- 79 shares of Tata Steel are needed for every 10 shares of Tata Metaliks.
- Tata Steel shares equal 17 shares for every 10 TRF shares.
Fascinatingly, shares of the listed subsidiaries had a sharp increase over the past month despite only a slight 0.7% increase in the benchmark Sensex. Shares of The Tinplate Company of India increased from Rs 295 to Rs 338, while those of Tata Steel Long Products increased from Rs 605 to Rs 749 in the previous month. Shares of Tata Metaliks increased from Rs. 715 to Rs. 801.
Benefits Of This Merger
According to the statement from Tata Steel,
- “The proposed mergers will increase managerial effectiveness, generate a stronger strategic focus, and boost agility across businesses”.
- The unification of operations will allow increased value-added segment growth by utilising Tata Steel’s extensive national marketing and sales network.
- The centralised procurement, inventory optimization, decreased logistics costs, and improved facility utilisation are other synergies that the mergers will create.
- After completion, there would be more possibilities to cut corporate expenses and overhead, and each of the planned mergers will increase value for shareholders, it claimed. With a 34 million tonnes per year capacity for crude steel, the Indian listed firm is also among the top global steel producers. In the fiscal year that ended March 31, 2022, the group reported a consolidated turnover of $32.83 billion.
