TATA STEEL

Tata Steel Limited (formerly Tata Iron and Steel Company Limited (TISCO)) is an
Indian multinational steel-making company headquartered in Mumbai, Maharashtra,
India, and a subsidiary of the Tata Group. Tata Iron and Steel Company was founded
by Jamshedji Tata and established by Dorabji Tata on 26 August 1907, as part of his
father Jamshedjis Tata Group. It was the 11th largest steel producing company in
the world in 2013, with an annual crude steel capacity of 25.3 million tonnes, and the
second largest steel company in India (measured by domestic production) with an
annual capacity of 9.7 million tonnes after SAIL.
Tata Steel has manufacturing operations in 26 countries, including Australia, China,
India, the Netherlands, Singapore, Thailand and the United Kingdom, and employs
around 80,500 people. Its largest plant is located in Jamshedpur, Jharkhand. In 2007
Tata Steel acquired the UK-based steel maker Corus. It was ranked 486th in the
2014 Fortune Global 500 ranking of the world's biggest corporations. It was the
seventh most valuable Indian brand of 2013 as per Brand Finance.

CORUS
Corus was formed from the merger of Koninklijke Hoogovens N.V. with British Steel Plc on 6
October 1999.
It has major integrated steel plants at Port Talbot, South Wales; Scunthorpe, North
Lincolnshire; Teesside, Cleveland (all in the United Kingdom) and IJmuiden in the
Netherlands.
It also has rolling mills situated at Shotton, North Wales (which manufactures Colorcoat
products), Trostre in Llanelli, Llanwern in Newport, South Wales, Rotterdam and Stockbridge,
South Yorkshire, England, Motherwell, North Lanarkshire, Scotland, Hayange, France, and
Bergen, Norway.
In addition it has tube mills located at Corby, Stockton and Hartlepool in England and
Oosterhout, Arnhem, Zwijndrecht and Maastricht in the Netherlands.
Group turnover for the year to 31 December 2005 was 10.142 billion. Profits were 580
million before tax and 451 million after tax.

Merger
Tata Steel Europe Ltd. (formerly Corus Group plc) is a steelmaking company
headquartered in London, United Kingdom, with its main operations in the United
Kingdom and the Netherlands.
Corus Group was acquired by Tata of India in 2007, and renamed Tata Steel Europe
in September 2010.
September 20, 2006 Corus Steel has decided to acquire a strategic partnership with
a Company that is a low cost producer. However Tata Steel wanted to expand its
business further. The initial offer from Tata Steel was considered to be too low by
Corus. Tata Steel kept its offer to 455p per share. Tata still doesnt react to Corus
and its bid price remains the same.On October 20, 2006 Corus accepted the term of
4.3 billion takeover bid from Tata Steel. Later, Corus was criticized by the chairman
of JCB, Sir Anthony Bamford, for its decision to accept an offer from Tata. The
Russian steel giant Severstal announced officially that it will not make a bid for
Corus. Within hours of Tata Steel increasing its original bid for Corus to 500 pence
per share, Brazil's CSN made its formal counter bid for Corus at 515 pence per
share in cash, 3% more than Tata Steel's Offer. Eventually on April 2, 2007 Tata
Steel manages to win the acquisition to CSN and has the full voting support from
Corus shareholders.
Tata acquired Corus, which is four times larger than its size and the largest steel
producer in the U.K. The deal, which creates the world's fifth-largest steelmaker, is
India's largest ever foreign takeover and follows Mittal Steel's $31 billion acquisition
of rival Arcelor in the same year.

Tata took over Corus for the following reasons: To Gain market share Since Corus was the largest in UK, second largest in
Europe and 6th largest in the world with a presence in 50 nations, Tatas market
share and penetration would increase substantially.
Utilization of surplus funds: Surplus fund mean cash flow available after the
payment of tax. It is the remaining money after all liabilities including tax,
insurance and expenses.
Strategic Objective: It is based on the mission and vision statement and how
they fulfill or move towards the higher goal.
Corus holds a number of Patents and R&D facilities.

 It would move from 55th position to 5th position in production of steel globally.
Economies of scale.
Enter new markets.
Acquire technology.

There are two strategies used by TATA;

1. Expansion through Merger and Acquisition The aim of the merger and
acquisition was to expand its(Tatas) existing business and reach a global
platform and get global recognition.
2. Expansion through Horizontal Integration - Horizontal integration is the
acquisition of additional business activities that are at the same level of
the value chain in similar or different industries. Since TATA Steel and
Corus were in the same industry and were producers in the steel industry,
it is a horizontal integration.