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STEEL INDUSTRY Contribution in the development of Indias economic growth:

The Indian steel industry is more than 100 years old now. The first steel ingot was rolled on 16th
February 1912 - a momentous day in the history of industrial India. Steel is crucial to the
development of any modern economy and is considered to be the backbone of the human
civilization. The level of per capita consumption of steel is treated as one of the important
indicators of socio-economic development and living standard of the people in any country. It is
a product of a large and technologically complex industry having strong forward and backward
linkages in terms of material flow and income generation. All major industrial economies are
characterized by the existence of a strong steel industry and the growth of many of these
economies has been largely shaped by the strength of their steel industries in their initial stages
of development.

India is the seventh largest steel producer in the world, employing over half a million people
directly with a cumulative capital investment of around Rs. 1,00,000 crore. It is a core sector
essential for economic and social development of the country and crucial for its defense. The
Indian iron and steel industry contributes about Rs.8,000 crore to the national exchequer in the
form of excise and custom duties, apart from earning foreign exchange of approximately Rs.
3,000 crore through exports. Consumption of finished steel grew by 5.9 % and increased to 24.9
million tones. steel consumption is likely to increase in the at a rapid pace in future due to large
investments planned in infrastructure development, increase urbanization and growth in key steel
sectors i.e. automobile, construction and capital goods.

Since, then the Indian steel industry has emerged as one of the core sectors in the Indian
economy with a very significant impact on economic growth. India with its abundant availability
of high grade iron ore, the requisite technical base and cheap skilled labor is thus well placed for
the development of steel industry and to provide a strong manufacturing base for the
metallurgical industries. TATA CORUS MERGER & ACQUISITION Page 3

4. The deregulated Indian steel industry is performing at its peak level in almost all spheres. The
total production of finished steel from April 2004 to March 2005 has been estimated to be about
383.25 lakh tones as against the production of 369.57 lakh tones during the same period last year
showing an increase of 3.7 %. The most spectacular achievement has, however, been recorded in
export performance. Steel has so far proved to be the single key factor responsible for industrial
production and thereby, for economic growth. And it is growing from strength to strength with
newer Developments--both within steel making practice as well as engineering developments,
which ask for more usage of steel. So much so, that economic development has become almost
synonymous with steel consumption.
Introduction About The deal

There are not many opportunities for producers in emerging low cost market to gain access to
the market of Europe other than by acquiring a company like Corus

- John Quigley

(Editor, Industry Publication Steel Week)

Tata acquired Corus which is 3 times larger than its size and largest steel producer in UK.

The deal which creates worlds 5th largest steel makers in Indias largest foreign take over
worth US$12.11billion.

TATA Steel Background

Tata steel a part of the Tata group, one of the largest diversified business conglomerates in

Started with a production capacity of 1, 00,000 tones, has transferred into global giant.

In the mid-1990s, Tata steel emerged as Asias first and Indias largest integrated steel
producer in the private sector.

In February 2005, Tata steel acquired the Singapore based steel manufacturer NatSteel, which
let the company gain access t major Asian markets and Australia.

Tata steel acquired the Thailand based millennium steel in December 2005.

Tata steel generated net sales of Rs.175 billion in the financial year 2006-07.

The companys profit before tax in the same year was Rs.64.14 billion while its profit after tax
is Rs.42.22billion.



Various Policies of Tata Steel:

Quality Policy
Safety Occupational Health and Environmental Policy

Human Resource Policy

Social Accountability Policy

Corporate Social Responsibility Policy

Drug & Alcohol Policy

HIV+ & AIDS Control Policy

Energy Policy

Towards organization: Tata was the 1st company to amend its articles of association including
the clause of social welfare.

Towards shareholders: Equal participation, straight forward business policy.

Towards employees: Pioneer of P.F. scheme, free medical and workmens corporation fund.

Towards Society: India should not be an economic super power, but a happy country.

Towards government: Suggestions of economic reforms and high tax payer company.

Towards consumers: Consumer is the king of market. Quality products & services timely
solutions of problems


The London-based Corus Group is one of the world's largest producers of steel and aluminium.
Corus was formed in 1999 following the merger of Dutch group Koninklijke Hoogovens N.V.
with the UK's British Steel Plc on October 6, 1999. It emoploys 47,300 people worldwide and
24,000 people in the United Kingdom.

Corus is a leading European manufacturer providing steel and aluminium products and services
worldwide. The company is comprised of four Divisions; Strip Products, Long Products,
Distribution & Building Systems and Aluminium2, and has a global network of sales offices and
service centres. It focuses on semi-finished and finished carbon steel products and is not
involved in iron ore extraction.
Corus is Europes second largest steel producer with revenues in 2005 of 9.2 billion (US$18
billion and crude steel production of 18.2 million tonnes, primarily in the UK and the
Netherlands. Corus provides innovative solutions to the construction, automotive, packaging,
mechanical engineering and other markets worldwide. Tata acquired corus, which is 4 times
larger than its size and the largest steel producer in the U.K. The deal, which creates the worlds
fifth largest steelmaker, is Indias largest ever foreign takeover and follow mittal steels $31
billion acquisition of rival arcelor in same year.

Tata acquires corus on the 2nd of April 2007 for a price of $12 billion. The price per share was
608 pence, which is 33.6% higher the first offer which was 455 pence.

For the fiscal year ended March 2006, the company generated revenues of $3,693.6million
(IR17,144.22 Crores), an increase of 0.1% over the previous fiscal year. The company saw a net
income of $755.4 million (IR3,506.38 Crores), an increase of 8%over fiscal 2005 months.


Worlds ninth largest and europe's second largest company. - High oprational cost - Wide range of
products of high - Lack of access to raw material. technology. SWOT -To get access to raw
materialand growth markets throug mergers. -Increasing losses resulting to winding up -To
merger with acompany to elimanated of company. duplication and remove overlaps in marketing,
accounting, etc

Overview of acquirer

Name: TATA Steel

Formal Name: Tata Iron & Steel Company Limited

Founded: 1907

Founder: Jamsetji Tata

Chairman: Ratan Tata

Type: Public (BSE 500470)

Industry: Steel

Parent: Tata Group

Overview of acquiree


Founded: 1999
Formation: Merger of Bristish Steel Corporation and koninklijke hoogovens N.V

CEO: Kirby Adams

Type: Subsidiary

Industry: Steel

Parent: Tata Steel, member of TATA Group

Reason behind bid from TATASteel

Tata Was Looking To Manufacture Finished Products In Mature Markets Of Europe

A Diversified Product Mix Will Reduce Risks While Higher End Products Will Add To Bottom

Corus Holds A Number Of Patents And R&D Facility

Tata Is Known For Efficient Handling For Labor And It Aims At Reducing Employee Cost
And Improve Productivity

It Will Move From 55th Position In World To 5th In Production Of Steel Globally.

Reasons for Tata Steel to Bid to tap European Mature Market.

Cost of acquisition is lower than setting up of Green field plant & marketing and distribution

TATA manufactures Low Value, long and flat steel products, while Corus produce High Value
Stripped products. Helped TATA to feature in Top 10 players in world.

Technology Benefit, Economic of scale. Corus holds number of patents and R&D facilities.

Reason From TATA Steel to Bid

To tap European Mature Market.

Cost of acquisition is lower than the setting Green field Plant & distribution channel.

TATA manufactures Low value long & fast steel products while corus produced high value
Stripped product.

Helped TATA to feature in top 10 players in the world.

Technology Benefit.
Economic of scale.

Corus holds number of patents and R&D facilities.

Reason from Corus to Bid

To extend its Global reach through TATA.

To get access to Indian Ore reserves, as well as virgin market for steel.

To get access to low cost materials.

Saturated market of Europe.

Decline in market share and profit.

Total Debt Of Corus Is 1.6 Bn Gbp

Corus Needs Supply Of Raw Material At Lower Cost

Though Corus Has Revenue Of $ 18.06 Bn Its Profit Was Just Of $626 Mn

Corus Facilities Were Relatively Old With High Cost Of Production

Employee Cost Is 15% While That Of Tata Steel Is 9%


TATA acquired Corus on 2nd April2007.

The deal price was US$12.11 billion.

On 17th Oct, 2006 TATAs bided at 455pence per share and price per share was 390 pence at
that time.

TATA steel, winner of the auction for CORUS declares a bid of 608 pence per share.

TATA Surpassed the final bid from Brazilian steel maker COMPANHIA SIDERUGGICA
NACIONAL (CSN) OF 603 pence per share.

The combined entity has become the worlds fifth largest steel makers after the deal.

Total TATA-Corus deal- US $ 13.7 billion

Equity component US $7.56 billion

Debt component US $ 6.14 billion

Acquisition was completed through Tata steels UK special Purpose vehicle named TATA

This SPV raised US $ 6.14 billion through a mix high yield mezzanine and long term debt

For immediate financing Tata Steel UK raised US$ 2.66 billion through bridge loans.


Immediately take over was required.

Share swap deal would have been less attractive to the Corus Shareholders.

Share swap would have meant FDI and that brings a lot of regulatory which might not have
been accepted by Corus shareholders.

Share swap would have diluted Tata steels equity base which was not in favor of Tata

And moreover cost of equity at around 15% is higher than that debt of around 8%, so paying in
cash brings down the cost of acquisition.

Corus-TATA Deal: An instance of how law can constrict M and A

The Corus-Tata deal continues to make news, even as both the companies continue to consider
various options to combine. For watchers of M&A (merger and acquisition), the deal is a case
study of how Indian acquirers have to consider takeover code and other laws in a different
country, such as the UK. This, apart from taking care that Indian laws are complied with.
While the Indian Companies Act, 1956, usually governs mergers in India, international deals
involve additional compliances with rules lay down under the FEMA (Foreign Exchange
Management Act, 1999) and associated law. Further, listed companies are also subject to the
rules and regulations laid down by the SEBI (Securities and Exchange Board of India).

"The latter two laws can complicate any cross-border M&A," says Mr Diljeet Titus of Titus &
Co, Advocates, New Delhi.

"There are often occasions when an interplay between SEBI regulations and those of FEMA can
make it difficult for deals to be structured.

The best example is the 3(3) notice required to be given in the case of inter-se promoter
acquisition under the SEBI takeover code," he says, referring to Regulation 3(3) of SEBI
(Substantial Acquisition of Shares and Takeovers) Regulations.

"The 3(3) notice mandates that a notice has to be given to the stock exchange where the shares of
the company are listed four days prior to any inter-se promoter transfer of shares.

"However, under the FEMA a non-resident can only acquire shares of an Indian company at
market price."

Mr Titus reasons that if the four-day notice is given to the stock exchanges, it encourages
speculation on the company's share price, making it difficult for the foreign acquirer to buy the
shares at market price.

"Because the market price may not be the true price of the shares but just a speculative price over
four days."

It is possible to make M&A less painful, feels Mr Titus. "SEBI and the RBI (Reserve Bank of
India) may each establish an effective legal cell, which should be able to respond to questions
raised by the parties to a merger on a timely basis," he suggests.

"A comprehensive database of FAQ (frequently asked questions) from these two organizations
could help. For, many of the questions that arise in current deals may arise in future deals too."


An amalgamation is regulated by the Companies Act, 1956 (CA56), and the company (Court)
Rules, 1959 (Rules). A company may merge with another body corporate, whether or not an
Indian company, provided the surviving entity of the merger is a company within the meaning of
the CA56. A scheme of amalgamation (scheme) requires approval of the High Court (Court) of
the States where the registered offices of amalgamating companies are situated. The steps for
amalgamation of companies under the CA56 and the Rules are as follow:
(1) Apply to the Court (by the company or any creditor or member of the company) for
directions to convene a meeting of the members and/or of creditors of the company, for purposes
of considering and approving the Scheme. Notice of the application must also be given to the
Regional Director, Company Law Board, whose representation is considered by the Court before
passing final orders.

(2) Pursuant to the Courts directions the amalgamating companies would need to give 21 days
notice of the meetings by advertisement in newspapers and then hold meetings fo their respective
members and/or creditors, according to the dates times, venues and quorum fixed for the
meetings by the Court. After approval of the Scheme by the requisite majority (1) the Chairman
of each ,eeting files his meetings report with the Court.

3) Within seven days of submission of the chairmans report to the Court, a final petition is filed
with the Court conforming the Scheme with a request for appropriate orders and directions by
the Court. The Court fixes a date for hearing the petition and the notice of the hearing must be
advertised in the newspaper(s) at least 10 days before the date fixed for the hearing.

(4) While considering the Scheme, the Court considers whether the applicant has disclosed to the
Court by affidavit all material facts relating to the company, such as the latest financial position
of the company, any investigation proceedings pending by the Company Law Board and that the
Scheme does not violate any provisions of law is not contrary to public policy but is fair, just and

If the Court receives no adverse representation from the Regional Director, the Court may
sanction the Scheme with appropriate orders and directions necessary for its proper working,
including transfer of properties or liabilities, dissolution of the transfer company without the
procedure of winding up, allotting of shares, debentures or other like interests, etc.

Thereafter, the amalgamating companies are required to file the order(s) of the Court sanctioning
the Scheme with their respective Registrars of Companies and, upon such filing; the order of the
Court becomes effective and legally binding. This Court process takes 3 6 months.

Tax Consideration: The Court order, being in effect a conveyance, is an instrument liable to
stamp duty that varies from state to state. However, if (1) at least 90% of the issued share capital
of the transferee company is in the beneficial ownership of the transferor company, or (2)
transfer is between a parent company and a subsidiary company, one of which is the beneficial
owner of not less 90% of the issued share capital of the other, or (3) transfer is between two
subsidiaries where not less than 90% of the issued share capital of each is in the beneficial
ownership of a common company of the other, then no stamp duty is payable, provided an
exemption certificate is obtained from the officer appointed by the State Government on their
The transferee company may carry forward losses incurred before the amalgamation. However,
to do this at least 51% of the shareholders of the transferee company (prior to the amalgamation)
should beneficially hold at least 51% of the votes on 31st March of each of the future fiscal years
in which the past losses are to be carried forward.

If the transferor company is carrying forward losses, then the following conditions must be met
to enable the transferee company to carry forward losses of the transferor company (post-merger)

1. The transferee company holds continuously for a minimum period of five years from the date
of amalgamation at least 75% of the book value of fixed assets of the transferor company
acquired in the Scheme;

2. The transferee company continuous the business of the transferor company for a period of five
years from the date of amalgamation;

3. The transferee company, owing an industrial undertaking of the transferor company by way of
amalgamation, achieves the level of production of at least 50% of the installed capacity of this
undertaking before the end of four years from the date of amalgamation and continues to
maintain this minimum level of production till the end of five years from the date of

However, the Central Board of Direct Taxes, on an application made by the transferee company,
can in suitable cases relax the condition of achieving the level of production or the period during
which it is to be achieved or both. The precondition for this is that genuine efforts are made by
the transferee company to attain the prescribed level of production and there are circumstances
preventing such efforts from attaining this level.

4. The transferee company furnishes to the Assessing Officer a certificate verified by an

accountant, with reference to the books of accounts and other documents showing particulars of
production, along with the return of income. These should relate to the assessment year relevant
to the previous year during which the prescribed level of production is achieved and to
subsequent assessment years relevant to the previous years falling within five years from the
date of amalgamation.


An acquisition may be in the acquisition of either shares or assets. While not considering the
merits and acquisition of assets and the higher stamp duty on the sale of assets.

1. FIPB Approval: Under the foreign direct investment policy of the Government of India, a
proposal for the acquisition of shares of an India company by a foreign company requires the
prior approval of the Foreign Investment Promotion Board (FIPB). However, FIPB approval is
not required for the sale and transfer of shares of an Indian company by a person resident outside
India to another person resident outside India, provided the transferee does not have a previous
venture or investment in India in shares or debentures or a technical collaboration or trade mark
agreement in the same or allied field in which the Indian company whose shares are being
acquired is engaged.

2. RBI Approval: An acquisition involving transfer of shares from a resident company/Individual

to a person not resident in India requires the prior approval of the FIPB and the Reserve Bank of
India(RBI). RBI approval is a two-tier process, with an in principle approval (approving the
transfer of shares, inter alia, subject to the remittance of the purchase price to the resident
company/individual) and thereafter a Final approval.

3. Compliance with the Securities and Exchange Board of India (SEBI) Act, 1992; Acquisition of
the shares of a listed company must comply with the requirements under the SEBI act
(Substantial Acquisition of Shares & Takeovers Regulations), 1997.

4. Approval of the Department of Company Affairs under CA56: An acquisition of shares in a

public company or a private company which is a subsidiary of a public company (Public
Company), requires the prior approval of the Department of Company Affairs (DCA), if (1) the
acquirer is under the same management as the Public Company (2) the acquisition would result
in the acquirer becoming the holder of more than 25% of the paid up share capital of the Public
Company, (3) the acquirer is the owner of a dominant undertaking and there would be, as a result
of such acquisition, an increase in the production, supply or distribution of goods produced in
India or services rendered in India by the dominant undertaking, or the acquirer could, as a result
of the acquisition, become the owner of a dominant undertaking.

Further, a transferor holding 10% or more of the nominal value of the equity shares of the Public
Company must inform the DCA before transferring one or more of such shares.

In some jurisdiction, mergers and acquisitions attract significant antitrust legislation. However, in
India, being a dominant undertaking does not, per se, create any antitrust or competition issues.

Only an abuse of a dominant market position may create antitrust issues.

Tax Considerations: Capital gains tax may be payable on the gains made by the seller on sale of
the shares of the company.

Also, to enable the transferor company to carry forward its losses, it is essential that at least 51%
of the shareholders of the transferor company beneficially hold at least 51% of the votes on 31st
March of each of the future fiscal years in which the past losses are to be carried forward.

Tata acquired Corus, which is 4 times larger than its size and the largest steel producer in the
U.K. The deal, which creates the worlds fifth largest steelmaker, is Indias largest ever foreign
takeover and follow Mittal steels $31 billion acquisition of rival arcelor in same year.
Tata acquires Corus on the 2nd of April 2007 for a price of $12 billion. The price per share was
608 pence, which is 33.6% higher the first offer which was 455 pence.

Equity contribution from Tata Steel - $3.88 billion Credit Suisse leaded, joined by ABN AMRO
and Deutsche provided bank in the consortium.

In 2005, Tata Steel was only the world's 56th biggest steel producer and its takeover of Corus
represents its first expansion outside Asia.


The main objective of Merger & Acquisition transaction is as follows:

Proper utilization of all available resources.

To prevent exploitation of unutilized and underutilized assets and resources.

Forming a strong human base.

Reducing tax burden.

Improving profits.

Eliminating or limiting the competition.

Achieving savings in monitoring costs.


The deal (between Tata & Corus) was officially announced on April 2nd, 2007 at a price of 608
pence per ordinary share in cash. This deal is a 100% acquisition and the new entity will be run
by one of Tatas steel subsidiaries. As stated by Tata, the initial motive behind the completion of
the deal was not Corus revenue size, but rather its market value. Even though Corus is larger in
size compared to Tata, the company was valued less than Tata (at approximately $6 billion) at the
time when the deal negotiations started. But from Corus point of view, as the management has
stated that the basic reason for supporting this deal were the expected synergies between the two
entities. Corus has supported the Tata acquisition due to different motives. However, with the
Tata acquisition Corus has gained a great and profitable opportunity to make an exit as the
company has been looking out for a potential buyer for quite some time.

The total value of this acquisition amounted to 6.2 billion (US$12 billion). Tata Steel the
winner of the auction for Corus declares a bid of 608 pence per share surpassed the final bid
from Brazilian Steel maker Companhia Siderurgica Nacional (CSN) of 603 pence per share.
Prior to the beginning of the deal negotiations, both Tata Steel and Corus were interested in
entering into an M&A deal due to several reasons. The official press release issued by both the
company states that the combined entity will have a pro forma crude steel production of 27
million tons in 2007, with 84,000 employees across four continents and a joint presence in 45
countries, which makes it a serious rival to other steel giants.

The official declaration of the completed transaction between the two companies was announced
to be effective by Court of Justice in England and Wales and consistent with the Scheme of
Arrangement of the Tata Steel Scheme on April 2, 2007. According the Scheme regulations, Tata
Steel is required to deliver a consideration not later than 2 weeks following the official date of
the completion of the transaction.

The process has started on September 20, 2006 and completed on July 2, 2007. In the process
both the companies have faced many ups and downs. The details of this process has described

September 20, 2006: Corus Steel has decided to acquire a strategic partnership with a Company
that is a low cost producer

October 5, 2006: The Indian steel giant, Tata Steel wants to full fill its ambition to expand its
business further.

October 6, 2006: The initial offer from Tata Steel is considered to be too low both by Corus and

October 17, 2006: Tata Steel has kept its offer to 455p per share.

October 18, 2006: Tata still doesnt react to Corus and its bid price remains the same.

October 20, 2006: Corus accepts terms of 4.3 billion takeover bid from Tata Steel

October 23, 2006: The Brazilian Steel Group CSN recruits a leading investment bank to offer
advice on possible counter-offer to Tata Steels bid.

October 27, 2006: Corus is criticized by the chairman of JCB, Sir Anthony Bamford, for its
decision to accept an offer from Tata.

November 3, 2006: The Russian steel giant Severstal announces officially that it will not make a
bid for Corus

November 18, 2006: The battle over Corus intensifies when Brazilian group CSN approached the
board of the company with a bid of 475p per share

November 27, 2006: The board of Corus decides that it is in the best interest of its will
shareholders to give more time to CSN to satisfy the preconditions and decide whether it issue
forward a formal offer
December 18, 2006: 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.

January 31, 2007: Britain's Takeover Panel announces in an e-mailed statement that after an
auction Tata Steel had agreed to offer Corus investors 608 pence per share in cash

April 2, 2007: Tata Steel manages to win the acquisition to CSN and has the full voting support
form Corus shareholders


Tata Steel has formed a seven-member integration committee to spearhead its union with Corus
group. While Ratan Tata, chairman of the Tata group, heads the committee, three of the members
are from Tata Steel and the other three are from Corus group.

The acquisition by Tata amounted to a total of 608 pence per ordinary share or 6.2 billion (US
$12 billion) which was paid in cash. First of all, the general assumption is that the acquisition
was not cheap for Tata.

The price that they paid represents a very high 49% premium over the closing mid- market
share price of Corus on 4 October, 2006 and a premium of over 68% over the average closing
market share price over the twelve month period. Moreover, since the deal was paid for in cash
automatically makes it more expensive, implying a cash outflow from Tata Steel in the amount
of 1.84 billion.

Tata has reportedly financed only $4 billion of the Corus purchase from internal company
resources, meaning that more than two-thirds of the deal has had to be financed through loans
from major banks.

The day after the acquisition was officially announced, Tata Steels share fell by 10.7% on the
Bombay stock market. Despite its four times smaller size and smaller capacity, Tata Steels
operating profit for 2006, earning $840 million on sales of 5.3 million tons, were very close in
amount to those generated by Corus ($860 million in profits on sales of 18.6 million tons).

Tatas new debt amounting to $8 billion due to the acquisition, financed with Corus cash
flows, is expected to generate up to $640 million in annual interest charges (8% annual interest
cost). This amount combined with Corus existing interest debt charges of $400 million on an
annual basis implies that the combined entitys interest obligation will amount to approximately
$725 million after the acquisition.
The debate whether Tata Steel has overpaid for acquiring Corus is most likely to be certain,
since just based on the numbers alone it turns out that at the end of the bidding conflict with CSN
Tata ended up paying approximately 68% above the average price of Corus shares.

Another pressing issue resulting for this deal that has created a dilemma between experts and
analysts opinions is whether this acquisition for the right move for Tata Steel in the first place.
The fact that Tata has managed to acquire a British steel maker that has been a symbol of
Britains industrial power and at the same time its dominion over India has been perceived as
quite ironic. Only time will show whether Tata will be able to truly benefit from the many
expected synergies for the deal and not make the typical mistakes made in many large M&A deal
during this beginning period.


The Companies Act Amendment Bill, which was tabled in Parliament in the Budget session that
adjourned last week, has proposed to allow Indian companies to merge with overseas companies,
a move that could introduce greater flexibility in cross-border merger and acquisitions (M&As).

At present Sections 391-394 of the Companies Act, 1956, allow only foreign companies to merge
with Indian ones. The Bill has introduced Section 205 that also allows the reverse and stipulates
that payment to shareholders of listed Indian companies being merged can be in the form of cash,
shares or Indian Depository Receipts (IDRs) issued by the overseas companies.

The amendment was first suggested in 2005 by an expert committee on company law chaired by
Tata Sons Director J J Irani. The report had stated that both contract as well as court-based
mergers between an Indian company and a foreign company, where the foreign company is the
transferee, needs to be recognised in Indian law.

The committee recognises that this would require some pioneering work between various
jurisdictions in which such mergers and acquisitions are being executed/created.

If this amendment goes through, it will meet a key demand of many multinational companies
investing in India.

Legal experts said the merger of an Indian company with a foreign one can help structure M&A
deals in many ways. For example, if an overseas company has acquired another foreign company
that has a subsidiary in India, the new provision will allow the acquirer to merge the Indian
operations with itself, instead of retaining it as a separate entity.

With Corus in its fold, Tata Steel can confidently target becoming one of the top-3 steel makers
globally by 2015. The company would have an aggregate capacity of close to 56 million tons per
annum, if all the planned Greenfield capacities go on stream by then.

We can conclude that if the acquisitions well planned, Executed and the necessary precautions
taken for the deal a company can achieve its strategic objectives and thus ensure its growth
through Acquisition.