The integration of the subsidiaries is aimed at enabling growth in value-added segments and is also aligned with Tata Steel’s long-term growth plans.
October 27, 2022
Tata Steel Ltd’s Board of Directors has approved and considered the proposed merger of seven of its subsidiaries with itself. The decision regarding the amalgamation plans was announced at a recently held board meeting.
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As per the press release by the steel major, the subsidiaries are all majority owned by Tata Steel and include Tata Steel Long Products Ltd. (74.91 percent equity holding), The Tinplate Company of India Ltd. (74.96 percent equity holding), Tata Metaliks Ltd. (60.03 percent equity holding), TRF Ltd. (34.11 percent equity holding), and The Indian Steel & Wire Products Ltd. (95.01 percent equity holding). Also included in the merger are its two wholly-owned subsidiaries, Tata Steel Mining Ltd. and S & T Mining Company Ltd.
“The proposed amalgamations will enhance management efficiency, drive sharper strategic focus and improve agility across businesses based on the strong parental support from Tata Steel leadership. In line with Tata Steel’s long-term strategy, the consolidation of the downstream operations will enable growth in value-added segments by leveraging Tata Steel’s nationwide marketing and sales network,” says Tata Steel in the statement.
The steel manufacturer considers synergies through raw material security, centralised procurement, optimisation of inventories, reduced logistics costs, and better facility utilisation, as the major advantages. The conglomerate also believes that there will be a further reduction of overhead and corporate costs after the conclusion of the merger.
