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or as consolidation of companies
Merger of companies. While acquisitions are where one company is taken over
by the company.
In the case of Merger, the acquired company ends to exist and becomes
There are different types of Mergers and Acquisitions which are as follows:-
1. Horizontal Mergers
2. Vertical Mergers
3. Concentric Mergers
Acquisitions (M&A) is done and a strategy for growth plan through the
target is done.
2. Phase 2: Search and screen targets: In this stage, possible takeover
agreement for a negotiated merger. This will result into deal getting
executed.
Accelerate growth
The buyer/acquirer
Tata Steel is one of the world's largest steel companies with a steel production
capacity of approximately 27.5 million tonnes per annum (MnTPA) as on 31
March 2017. The company is a diversified steel producer with major operations
in India, Europe and South East Asia. The company has manufacturing units in
26 countries and a commercial presence in over 50 countries. Tata Steel is the
second largest steel producer in Europe with a crude steel production capacity
of over 12.1 million tonnes per annum.
The company together with its subsidiaries, is engaged in the manufacture and
sale of steel products in India and internationally. They offer hot and cold rolled
coils and sheets, galvanized sheets, tubes, wire rods, construction rebars and
bearings. Tata Steel is one of the few steel companies that are fully integrated -
from mining to the manufacturing and marketing of finished products.
The deal
Tata Steel completes Rs 35,200 crore purchase of bankrupt Bhushan Steel in 2018.
Tata Steel had acquired Bhushan Steel under the Corporate Insolvency Resolution Process in April this year for Rs
35,200 crore. T V Narendran Tata Steel’s Global CEO & MD who chaired the meeting briefed the members on the
corporate insolvency resolution process of the company, its financial performance for the year ended March 31, 2018
and activities in connection with aligning the company's operations with that of Tata Steel.
Tata Steel said Rs 1,200 crore will be paid to operational creditors of BSL over a
period of 1 year as per their admitted claims and terms of resolution plan. Tani
ha danbayso
Tata Steel has formally taken control of Bhushan Steel, settling about Rs 35,200
crore, or nearly two-thirds, of the loans the bankrupt steelmaker owed to
lenders and appointing three nominees on its board.
statement issued by Tata Steel said the investment from Bamnipal Steel in
Bhushan Steel has been done through a combination of equity of Rs 158.8 crore
and intercorporate loans of Rs 34,973.6 crore. Bamnipal has paid another Rs
100 crore to creditors of Bhushan Steel. Further, as per the terms of their
resolution plan, Rs 1,200 crore would be paid to operational creditors over a
period of 12 months.
Bhushan Steel is the first to emerge successful from insolvency and bankruptcy
process among the initial dozen big defaulters that the central bank referred for
resolution under a law enacted for quick recovery and settlement of stressed
assets.
Banks, which though have taken a more than 37% haircut on their outstanding
loans of Rs 56,079 crore to Bhushan Steel, can now classify the assets as
standard, reducing their bad loan burden. They are likely to reverse the
provisions they had made against the account, significantly boosting their first-
quarter results. State Bank of India had the highest exposure of Rs 12,872
crore to Bhushan Steel, followed by Punjab National Bank at Rs 4,904 crore and
ICICI Bank at Rs 2,449 crore.
As per the deal, Bamnipal Steel, a wholly owned subsidiary of Tata Steel, will
get a 72.65% stake in
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Tata Steel completes Rs 35,200 crore purchase of bankrupt Bhushan Steel