New Delhi: Tata Steel on Saturday announced it will acquire the steel business of Usha Martin Ltd for 4,300-4,700 crore.

The sale of steel business to Tata Steel will help the company in “significant reduction" of its debt, Usha Martin said in a filing to the BSE. The deal is expected to be completed in 6-9 months, it added.

Tata Steel, in a release, said it has executed definitive agreements for the acquisition of Usha Martin’s steel business through a slump sale on a going concern basis. “It is proposed that the steel business of Usha Martin Ltd will be acquired subject to transaction closing, for a cash consideration of between 4,300 and 4,700 crore (subject to various transaction adjustments)," the release said.

The closing of the acquisition is subject to fulfilment of various conditions under the agreements.

Usha Martin’s steel business comprises the specialised 1 million-tonnes-per-annum (MTPA) alloy based manufacturing capacity in the long products segment based in Jamshedpur, a producing iron-ore mine, a coal mine under development and captive power plants.

The transaction and acquisition structure would be determined shortly, Tata Steel added.

Tata Steel had an annual capacity of 27.5 MTPA as on March 31, 2018. Usha Martin is among the largest wire rope manufacturers in the world and a leading speciality steel producer in India.

Also read: Usha Martin board gives approval for sale of steel business

In May, Bamnipal Steel Ltd, a wholly-owned subsidiary of Tata Steel, completed the acquisition of a controlling 72.65% stake in Bhushan Steel Ltd . Tata Steel had won the bid to acquire debt-laden Bhushan Steel in an insolvency auction.

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.

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