Tata Steel’s board has approved the scheme of merger with its seven group companies
These companies are – Tata Steel Long Products, The Tinplate Company of India, Tata Metaliks,
TRF Limited, the Indian Steel & Wire Products, Tata Steel Mining and S&T Mining Company
The share exchange ratio has been decided individually for the seven companies, as per the filing
This megamerger decision have been taken to simplify the group holding structure.
Since 2019 Tata Steel has reduced 116 associated entities
Each scheme of merger needs a defined regulatory approval process, by stock exchanges and the NCLT
The merger is expected to result in focused growth, and operational efficiencies, and create synergies amongst the business, the 5S strategy – which is simplification, synergy, scale, sustainability, and speed
Koushik Chatterjee, ED & CFO of Tata Steel said, amalgamation of Tata steel with these 7 companies, will lead to a total cost saving of up to Rs 1500 crore, including Rs 700 crore royalty which was paid by Tata Steel to the govt.
Share Swap Ratios For The Proposed merger is announced only for these companies
For every 10 shares of Tata Steel Long Products, 67 shares of Tata Steel will be given
– For every 10 shares of TRF, 17 shares of Tata Steel will be given.
– For every 10 shares of The Tinplate Company of India, 33 shares of Tata Steel will be given
– For every 10 shares of Tata Metaliks, 79 shares of Tata Steel will be given
Affect of this news on all the shares
After the announcement of this news, excluding Tata Steel all the other shares was down, even TRF share got the lower circuit.