Tata Steel board approves acquisition of majority stake in Thriveni Pellets

New Delhi, Dec 10 (PTI) Tata Steel on Wednesday said its board has approved the acquisition of 50.01 per cent stake in Odisha-based Thriveni Pellets Pvt Ltd (TPPL) for up to Rs 636 crore.

The acquisition is set to bolster Tata Steel's supply chain, especially in the crucial sector of raw materials.

TPPL owns 100 per cent stake in Brahmani River Pellet Ltd (BRPL), which operates a 4 million tonne per annum pellet plant in Jajpur, Odisha, along with a 212 km slurry pipeline.

The balance 49.99 per cent stake in TPPL is held by Lloyds Metals.

In a filing to the BSE, Tata Steel said "the board at its meeting held today... approved the acquisition of 50.01 per cent equity stake in Thriveni Pellets Private Limited (TPPL) from Thriveni Earthmovers Private Limited ('TEMPL'), for a consideration of up to Rs 636 crore." The transaction is likely to be completed within 3-4 months, subject to necessary regulatory approvals.

The transaction is subject to approval from the Competition Commission of India, it said.

Lloyds Metals and Energy Ltd further said it has entered into a pact with Tata Steel Ltd to explore strategic partnership in the areas of raw material mining, logistics, pellet and steel making.

The proposed partnership aims at utilising the natural synergy in the business operations between Lloyds Metals and Tata Steel.

The MoU sets out a framework for both companies to evaluate potential cooperation in greenfield steel making projects, iron ore mining, slurry pipeline infrastructure, pellet making in iron ore rich states, direct reduced iron production and exports of value-added low carbon iron and steel products among other associated areas of mutual interest.

The objective is to utilise complementary strengths of Tata Steel and Lloyds Metals to promote sustainable and efficient growth in the domestic steel sector, it said.

Tata Steel also said in the regulatory filing that its board has affirmed the long-term growth strategy for India business and considered several options and proposals, as per the filing.

In line with the objective of pursuing prudent capital allocation and profitable growth, the company will prioritise investments in the volume growth, added downstream portfolio, identified mining assets and infrastructure to serve the needs of the India business, it said.

The company will also invest in low carbon, low capital intensity process technologies for sustainable steel making of the future.

The board has accorded in-principle approval for the 4.8 MTPA capacity expansion at Neelachal Ispat Nigam Ltd (NINL).

As part of further enhancing the finished steel capacity in the flats products, the Board has approved the funds required to undertake the design and engineering work to set up of a 2.5 million tonnes thin slab caster and rolling facilities at Tata Steel Meramandali and also progress on seeking all regulatory approvals for the expansion.

This will expand the finished steel capacity particularly of thinner gauge products by 2.5 million tonnes per annum (MTPA), it added. PTI SID TRB TRB