Tata Steel Reached Agreement to Divest Stake in Steelmaking Unit

SEATTLE (Scrap Monster): India-headquartered integrated steelmaker Tata Steel Ltd. said that it has reached a definitive agreement to divest its 100% stake in the Singapore steelmaking unit, which operates under its indirect subsidiary based in that country- T.S. Global Holdings.

According to company press release, the definitive agreement to divest the entire stake in NatSteel Holdings Pte Ltd has been reached for an equity value of $172 million. The agreement was signed with TopTip Holding Pte Ltd- a steel and iron ore trading company based in Singapore.

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Tata Steel announced that the enterprise value to EBITDA of the transacted business is around 13 times, based on historical performance.  It had posted revenue of INR 2,852 crore in FY21. It has closed the transaction and received the consideration, which will be utilized towards reducing its off-shore debts, the press release noted.

Meantime, the company has decided to retain Siam Industrial Wires- the wire business of NatSteel in Thailand. It will continue to be part of its downstream wires portfolio. It must be noted that the business operates as a wholly-owned subsidiary of the Tata Steel Group.

Tata Steel had acquired NatSteel Singapore in 2004.