The board of directors of India’s Tata Group has approved the merger of seven metal companies with Tata Steel Limited, a regulatory filing by the group said on Friday, September 23.
The seven companies to be merged with Tata Steel are: Tata Steel Long Products Limited (TSLPL), The Tinplate Company of India Limited (TTCIL), Tata Metaliks Limited (TML), TRF, Indian Steel and Wire Products Limited (ISWPL), Tata Steel Mining Limited (TSML) and S&T Mining Limited.
According to the filing, Tata Group said that each of these companies was reviewed and recommended to the Board by the Committee of Independent Directors and the Audit Committee of the Company.
Explaining the rationale behind the merger scheme, Tata Steel said in the filing that the resources of the merged entities can be pooled to unlock the opportunity for creating shareholder value. Besides citing other synergies, it also highlighted that the mergers will result in utilization of each other’s facilities in a more efficient manner, and marketing and distribution networks of all entities can collaborate.
“In line with group level 5S strategy - simplification, synergy, scale, sustainability, and speed - the proposed merger scheme will simplify the group holding structure, improve agility to enable quicker decision making, and eliminate administrative duplications, consequently reducing administrative costs of maintaining separate entities,” Tata Steel said.
