To make matters worse, the cost of power in UK was high, and many of its plants were significantly over-manned and pushing through job cuts was stoutly opposed by the unions. This is known as reverse takeover. Corus had been facing tough times and had reported a substantial decline in profit after tax in the year It was a manufacturer of semi-finished and finished carbon steel products at plants in Europe, including in the UK and the Netherlands. Case studies may be descriptive or explanatory. But during the time of acquisition held in , the price per share was pence, which is

Some more insights could have been brought in if the top management of the companies might have been involved though feasibility was an issue. Corus Corus was formed in when British Steel and Koninklijke Hoogovens of the Netherlands combined to form a new entity which they named Corus. There has been a rapid expansion of outward foreign investment from India and a boom of acquisitions is the more significant development. Studies that focused on operating performance showed improvement in cash flow: Tata Steel’s Acquisition of Corus.

Case Study Volumes Collection. It investigates a phenomenon within its real-life context.

Tata Corus: 7 Lessons from a Deal from Hell | Founding Fuel

Law Vikas Publication House, pp Finally, in February this year, the board finally gave Kohler the marching orders. The Merger Deal The deal between Tata and Corus was officially announced on April 2nd, at a price of pence per ordinary share in cash.

Merger In business or in economics a merger is a combination of two companies into one larger company.

Building and Construction was the largest market sector for Corus [8]. After the acquisition Tata steel became 5 th largest producer of steel in the world, resulting in increased profitability.


Sign up and we’ll send you articles like this every week. WordPress Embed Customize Embed. The production capacity figure for includes Stocksbridge for half the year. To make matters worse, the cost of power in UK was high, and many of its plants were significantly over-manned and pushing through job cuts was stoutly opposed by the unions.

Economies of scale would give more strength during raw material purchase negotiation and also while implementing product price changes. According to the Scheme regulations, Tata Steel is required to deliver a consideration not after than 2 weeks following the official date of the completion of the transaction. The case study is based upon secondary sources of information including company annual reports, financial results, Newspapers, Business Magazines, Internet, other reports.

And the underperformance in UK was masked by its well-run Dutch operations at Hoogovens. The Indian economic reform since has opened up a whole lot of challenges both in the domestic and international spheres. Ever since the Tata Steel board took the call to sell off its haemorrhaging UK assets last month, old Tata Steel hands in Jamshedpur have been heaving a sigh of relief. It provides a framework for the evaluation. This case study was compiled from published sources, and is intended to be used as a basis for class discussion.

The second option would be to shift a part of Corus steelmaking capacity to India, where Tata Steel was already planning a massive expansion to cater to the rapidly growing demand of steel in the country. For delivery in electronic format: He used event study methodology to measure abnormal returns for 30 day window around the earnings announcement and reported that there was no statistical evidence to show that Indian capital market was efficient in its semi strong form.


merger of tata steel and corus case study

Why potential suitors will line up for the Maharaja. FINC click on the button below, and select the case from the list of available cases: The abnormal returns of bidding firms adjusted on the basis of book to market ratio and size are computed for 36 months 3 years after the merger completion. Go to Application Have a question?

merger of tata steel and corus case study

Warren criticism of u s steel company is well known. The globalization has a Greenfield ttaa too. The book examines the evidence for the failure of the acquisitions and the likely causes of the failure in addition with cross border mergers, the rationale behind them, the recent trend in and the barriers mergers.

Tata Corus: 7 Lessons from a Deal from Hell

This acquisition was the biggest overseas acquisition by an Indian company. Automatically changes to Flash or non-Flash embed. A few months later, Brazilian steel maker CSN made an entry with a higher offer. Furthermore, with its wire manufacturing facilities in India, Sri Lanka, and Thailand, Tata Steel intends to play a significant role in the global wire business.

Corhs the Tatas chose to soft-pedal, restraining its leaders from taking too hard decisions and actually confronting the unions. It is true that the Tatas may have gone in with their eyes open that the underperforming UK assets could prove to be problematic.