All metal compaines of Tata group to merged into Tata Steel to form a single entity.

The board of directors of Tata Steel has approved the merger between seven of its group companies and itself, according to a statement filed with the SEBI. Thursday's board meeting resulted in the decision, according to an exchange filing. The company has abandoned its previous plan to merge Tata Steel Long Products and Tata Metaliks. According to the current merger proposal, Tata Steel will acquire all of the Tata group's metal companies, including Tata Metaliks, TRF, Tata Steel Mining, Indian Steel & Wire Products, S&T Mining, Tata Steel Long Products, and Tinplate. Four of the seven companies that will be merged to become Tata Steel are publicly traded, while the other three are not.

How will this merger take place?

Share swaping will be done for  the listed companies of Tata group. The share exchange ratio has been decided individually for the seven companies, according to the filing.

For every 10 Share of Tata Steel Long Products shareholders will receive 67 shares of Tata Steel. Similarly for 10 Shares of Tinplate Company of India 33 shares of Tata Steel  and Tata Metaliks 79 shares of Tata Steel for every 10 shares held
TRF: 17 shares of Tata Steel for every 10 shares held.

Name of companyCurrent valueno of Share Tata Steel no sharesCurrent value
Tata Steel Long Products681/share 1067105/share
Tinplate Company of India371/share1033105/share
Tata Metaliks775/share1079105/share
The Share price provided above is recorded on 23 September 2022 so may change.

Tata Steel is seeing the following synergy benefits as a result of the merger of its subsidiaries with itself:

  • Operational integration,
  • improved facility utilisation, operational cost reduction, and increased sales
  • centralised procurement and stock administration
  • Management effectiveness of working capital and cash flow.
  • Enhancing raw material safety
  • Acceleration of project execution in the pipeline
  • Reduction of logistics expenses
What will happen to the shares of Tata metaliks after merger?

Shareholders of Tata Metaliks will be allotted shares of Tata Steel after the merger. 79 shares of Tata Steel for every 10 shares of Tata Metaliks.

Will there be any impact for shareholders of Tata steel and other group compaines ?

Although the merger announcement is excellent from a long-term viewpoint, it has no immediate impact for Tata Steel firms. However, there will be administrative cost savings.

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