Tata Steel Wins Takeover Fight For Corus

Jan. 31, 2007
The companies' combined annual output at 22.6 million tons creates the world's sixth biggest producer.

Tata Steel bought Corus for $13.7 billion on Jan. 31, beating Brazilian rival CSN in an overnight auction that highlighted the growing power of emerging market companies.

The takeover battle pitched steel titans from Brazil and India -- both emerging economic superpowers -- against each other for a valuable part of the European steel industry.

Corporate India now looms large in the global steel sector, especially after Mittal Steel, led by Indian tycoon Lakshmi Mittal, forged a $32.4 billion blockbuster deal to create market leader Arcelor Mittal last year.

"Tata and Corus are stronger together and will be able to compete effectively in an increasingly global environment. This combination creates a strong and robust platform for growth that will benefit all stakeholders," said Corus chairman Jim Leng in a group statement

Tata Steel chairman Ratan Tata, speaking in Mumbai earlier Jan. 31, called the bid a "visionary" step for India -- but saw his company's shares slump on investor fears that the group was overpaying.

If completed, the deal will create the fifth-largest steel player in the world with annual steel output of about 25 million tons and 87,000 employees, according to the companies.

Figures from the end of 2005 compiled by the International Iron and Steel Institute put Tata and Corus combined annual output at 22.6 million tons, the world's sixth biggest producer.

Tata Steel, part of the huge Tata conglomerate, has previously stated that its Corus takeover plans would create a high-quality, low-cost, attractive growth platform in Asia combined with a leading European steel player.

Copyright Agence France-Presse, 2007

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