Tata Steel to acquire 100% equity shares of Brahmani River Pellets Limited, for an enterprise value of Rs 900 crore

By: |
New Delhi | Updated: December 23, 2016 4:21:53 PM

Tata steel had announced that while the deal is based on the enterprise value of Rs 900 crore, the the funding for acquiring the the complete equity shares in BRPL will be done from Tata Steel's internal cash flows.

Tata steel had also announced that while the deal is based on the enterprise value of Rs 900 crore, the the funding for acquiring the the complete equity shares in BRPL will be done from Tata Steel's internal cash flows. (Reuters)Tata steel had also announced that while the deal is based on the enterprise value of Rs 900 crore, the the funding for acquiring the the complete equity shares in BRPL will be done from Tata Steel’s internal cash flows. (Reuters)

Amid continuing spat among the directors of the board, Tata Steel had today announced the execution of definite agreements to acquire 100 % equity shares of the Brahmani River Pellets Limited (BRPL) from Aryan Mining and Trading Corporation Private Limited (AMTC) and other companies associated with the Moorgate Industries Group (MIG). In a press note released today, Tata steel had also announced that while the deal is based on the enterprise value of Rs 900 crore, the the funding for acquiring the the complete equity shares in BRPL will be done from Tata Steel’s internal cash flows.

It its press release, Tata Steel quoted the Group Executive Director (Finance & Corporate) and its borad member Koushik Chatterjee, saying, “The location of the BRPL assets makes this very strategic to Tata Steel especially to our Kalinganagar operations and has significant operating synergies to make our Kalinganagar plant even more competitive for the future.”

Also Watch:

Brahmani River Pellets Ltd (BRPL), which had a turnover of Rs 452 crore in 2015-16, owns a 4 million tons per annum capacity pellet plant in Jajpur and a 4.7 million tons iron ore beneficiation plat in Bardil, Odisha. A 220-km slurry pipeline connects the pellet plant with the beneficiation plant. It manufacturers iron ore pellets for iron and steel industry.

“The acquisition provides an upstream integration opportunity to Tata Steel to meet its metallic requirements and improving the feed mix for its Kalinganagar steel plant and Jamshedpur steel plant,” the company said in a statement.

The deal, which is subject to regulatory approvals, is expected to close in four months. It also needs approval from RBI and other regulatory bodies to restructure BRPL’s balance sheet, including shareholders loan and advances.  The company was originally established by the Moorgate Industries Group (MIG), which continues to hold a significant stake in BRPL through its shareholding in AMTC. MIG was formed on demerger from the Stemcor Group of Companies as part of a UK court-approved restructuring in 2015.

(With inputs from agencies)

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.