Tata Steel Vice-Chairman B. Muthuraman on Monday said his company would not divest its stake in Australian mining firm Riversdale, which was acquired by global mining giant Rio Tinto early this month.
Asked whether the Indian steel major will continue to hold a stake in Riversdale, Mr. Muthuraman said: “Yes''. However, he refused to reply further on the issue.
This reply assumes significance in the wake of Rio Tinto's announcement last week that it has extended the takeover offer to April 29 for Riversdale shareholders. Last week, Rio had said that it has acquired 72 per cent stake in the Australian mining firm and purchased the entire stake (19.9 per cent) of Brazilian steel maker CSN — another big shareholder in the Australian mining firm. Tata Steel, with a stake of 27.14 per cent in Riversdale, is now the second largest shareholder in the company.
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Tata Steel had stated on earlier occasions also that it would stay put in Riversdale as its focus is mainly on getting coal rather than just making a quick buck, as the Australian mining firm holds an estimated 13 billion tonnes of thermal coal reserves in two projects in Mozambique. Tata Steel, which has over 28 million tonnes per annum steel-making capacity now, needs to have coking coal, an important steel-making raw material, to feed its operations across geographies.
Meanwhile, Tata Steel on Monday conducted the ground breaking ceremony for setting up the six lakh tonne per annum continuous annealing and processing line (CAPL) project. Tata Steel and Nippon Steel had signed an agreement in January to set up India's first continuous annealing and processing line (CAPL) for the production of automotive cold-rolled steels at Jamshedpur. This facility will address the growing localisation needs of automotive customers for high-grade cold-rolled steel sheet.