Ratan Tata Tata-Corus entity chairman
Jim Leng of Corus will be its deputy chairman, managing director of Tata Steel Muthuraman, announces.india Updated: Oct 20, 2006 16:42 IST
Ratan Tata, chairman of Tata Sons, will be at the helm of the merged entity called Tata Steel and Corus after the board of the Anglo-Dutch company accepted the Indian steel major's $8 billion takeover bid on Friday.
"The merged company will the fifth largest steel company in the world. Next year will be the 100th year of Tata Steel - and we don't intend stopping there," said B Muthuraman, managing director of Tata Steel, at a press conference here.
"We have a culture of continuous improvement. We are excited in Tata Steel and Corus. I believe we are at the beginning of yet another phase of consolidation in the global steel industry," he said.
Ratan Tata, who had earlier described the deal as a "defining moment for Tata Steel, would be chairman of the merged entity, while Jim Leng of Corus will be its deputy chairman, Muthuraman announced, adding the decision would result in "the right partner, at the right time and on right terms".
Corus officials Philippe Varin, Schraven and Hayward will join the Tata Steel board while Muthuraman, Ishaat Hussain and Arun Gandhi would be on the Corus board. Both companies had a strong cultural fit, Muthuraman said.
Both Muthuraman and Varin allayed fears of job losses due to the takeover, and said that the deal was for the long-term and was about growth. There have been fears in Corus units in the UK that the deal may result in job losses.
"The biggest threat to jobs was if the deal had not taken place. This deal ensures that there will be no job losses. Tata has a long history of taking good care of people," Muthuraman added.
Responding to questions, he said that Tata Steel did not intend to export iron ore. He said Tata Steel had initiated expansion plans in its Jamshedpur plant while new units were on the anvil in other places in Jharkhand and Chattisgarh.
There were several synergies and potential for cross-fertilisation between the two companies, Muthuraman said, and added that Tata Steel had a wide retail and distribution network in India and Southeast Asia.
The Tata proposal will now be placed before Corus shareholders for approval.
A company born out of the merger of Tata and Corus will means that three of the top 10 steel producing companies in the world will be in Indian hands.
The biggest steel company is Mittal Steel, owned largely by LN Mittal and his family. Earlier this year, Mittal Steel took over steel major Arcelor, which is the second largest producer of the commodity.
Corus is Europe's's second largest steel producer with revenues in 2005 of £9.2 billion and crude steel production of 18.2 million tonnes, primarily in the UK and the Netherlands. Tata Steel produces 5 million tonnes per annum.