Tata Steel completes proposed amalgamation of five of nine subsidiaries

New Delhi: Tata Steel Ltd announced that it has successfully amalgamated five of its nine strategic businesses, in line with its long-term strategy and commitment to simplify its business portfolio. In an exchange filing on Wednesday, the company said the integration of the five businesses was underway after it completed the regulatory processes.

The five companies being integrated are Tata Steel Mining Ltd, Tata Steel Long Products Limited, S&T Mining Company Limited, The Tinplate Company of India Ltd, and Tata Metaliks Limited.

“The merger of five companies with a cumulative annual turnover of ₹19,700 crore in FY23, in record time, presents a unique opportunity for consolidation of the downstream operations,” the company said.

It added that Tata Steel Mining (turnover of ₹5,000 crore in FY23), was merged in September 2023, while Tata Steel Long Products (turnover of ₹7,464 crore in FY23), was merged in November 2023. S&T was merged in December 2023, while the merger of The Tinplate Company (turnover of ₹3,983 crore in FY23), took place in January 2024, and that of Metaliks Limited (turnover of ₹3,260 crore) took effect on 1 February 2024.

“This will enable growth in value-added segments by leveraging Tata Steel’s nationwide marketing and sales network. The amalgamation is value-accretive and will also drive synergies through raw material security, centralised procurement, optimisation of inventories, reduced logistics costs, and better facility utilisation,” Tata Steel said.

Three other companies that Tata Steel plans to merge are Bhubaneswar Power Private Limited (a wholly owned subsidiary of Tata Steel), Angul Energy Limited (of which it owns 99.99%) and The Indian Steel and Wire Products Limited (of which it owns 98.15%). The company said, “The merger process is in advanced stages with the respective jurisdictional company law tribunals and is expected to be completed by Q1FY25, subject to regulatory approvals.”

A ninth subsidiary – TRF Ltd – was also to be amalgamated, but Tata Steel said the boards of both companies decided not to pursue this.

“Since the announcement of the intended merger of TRF Ltd. in September 2022, Tata Steel has been providing significant operational and financial support by way of placement of orders and infusion of funds,” the company added.

TRF Ltd undertakes turnkey material-handling projects for the infrastructure sector, such as power and ports, and the industrial sector, such as steel plants, cement, fertilisers and mining. It also produces such material-handling equipment at its facility at Jamshedpur, and provides services related to design and engineering supervision.

Tata Steel added that with its support, TRF successfully navigated a highly challenging operating environment and is now seeing a turnaround in its performance.