New Delhi: Tata Steel on Tuesday said it has offloaded 51% stake in group company Tata Refractories to Nippon Steel’s associate Krosaki Harima Corporation (KHC) and inducted the Japanese firm as a strategic partner.
The deal is valued at Rs 576.3 crore, going by the Tata Refractories’s (TRL) valuation at Rs 1,130 crore.
“... the company has completed the transaction and received the relevant consideration for the transfer of 51% equity shares of TRL out of its current stake of 77.46% stake in TRL to Krosaki Harima Corporation of Japan at an equity valuation of Rs 1,130 crore,” Tata Steel said in a filing to the Bombay Stock Exchange.
Earlier, on 21 April, the leading steel maker had announced that it had entered into definite agreement with the Japanese firm for the deal.
Tata Steel would continue to hold 26.46% stake in the TRL - the largest domestic refractories manufacturer.
Tata Steel managing director Hemant Nerurkar had last month said that the partnership will propel the business to greater heights in future.
Bringing in KHC as strategic partner will bring technical expertise into the Tata Refractories and would give it access to new markets.
Krosaki Harima Corp is a leading global refractories maker and its 42.9% equity is owned by Nippon Steel. The company, listed on the stock exchanges at Tokyo and Fukuoka, had a sales of 82,874 million Japanese yen as on 31 March 2010.
On the other hand, Tata Refractories is the largest refractories manufacturer in India and meets the requirement of industries like steel, glass, cement, non-ferrous and petro-chemicals.
Its refractories works at Belpahar, Orissa, is considered to be the largest among all single refractory producing units in the world.
According to industry estimates, TRL has an annual production capacity of 3.4 lakh tonnes. The company also has a manufacturing unit in China.
Scrips of Tata Steel closed at Rs 589.10 apiece on the Bombay Stock Exchange today, up 1.51% from the previous close.