Tata Steel product mix set to expand

Tata Steel’s decision to acquire Usha Martin’s one million-tonne steel business for a cash consideration of up to Rs. 4,700 crore would lift the company’s volume of long products by 24% and expand its product mix, analysts say. Usha Martin’s alloy long steel products cater to higher value-added automotive and engineering segments. Tata Steel, with an existing capacity of 29.5 million tonne has signed a definitive agreement to acquire Usha Martin’s speciality steel business through a slump sale on a going concern basis. “Deal valuation appears reasonable. Net debt to EBITDA could rise slightly to 3.6x. Impact on valuation would not be meaningful, in our view,” wrote Jefferies analyst Bhaskar Basu in a research note. Along with the steel unit, comes captive mines for iron ore with 2.5 million tonnes output in FY18, a thermal coal mine, which is under development and downstream assets like wire rod and bar rolling mills.
Source :  https://www.thehindu.com/todays-paper/tp-business/tata-steel-product-mix-set-to-expand/article25032819.ece

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