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Tata Steel to sell Corus aluminium business
Kausik Datta & Ishita Ayan Dutt in Mumbai | June 30, 2007 14:11 IST
Six months after acquiring Anglo-Dutch steel giant Corus, Tata Steel has put the foreign company's aluminium business on the block.
The aluminium business, which comprises two smelters in the Netherlands and Germany, is expected to fetch over $1 billion (Rs 4,000 crore).
Tata Steel [Get Quote] was catapulted to the world's fifth largest steel company through the acquisition of Corus for an enterprise value of $12.9 billion in January, the highest ever overseas buyout by any Indian company.
Sources close to the development said German aluminium producer Trimet had shown interest in the business but added that it might not be sold to a single buyer. The smelters are in Delfiz in the Netherlands and Voerde in Germany.
A Corus spokesperson said the company was evaluating the best strategic option for the aluminium business but declined to comment on the identity of the buyers.
"The aluminium business was identified as a non-core area of operations four years ago. Last year, we sold the downstream aluminium business. Now, the main concern for the aluminium business in the Netherlands is the high energy cost," she added.
Corus sold its downstream aluminium business, including its rolling and extrusions business in Europe, for $1 billion (Rs 4,000 crore) to Aleris last year. After the sale, Corus agreed to long-term contracts to supply Aleris with raw material. "So, the primary aluminium business is secure. Even then, the high energy cost is a major concern" she said.
Trimet has been managing its business well despite high energy costs. Last year, it bought the electrolysis and anode units of the Hamburger Aluminium-Werk smelter in Germany.