Mumbai: Tata Steel, the world's sixth largest steel maker, has set up a fully-owned holding company for its overseas assets, which will act as a vehicle for its global expansion, Koushik Chatterjee, chief financial officer, said.
"Tata Steel Global has come into effect today. We will transfer all our existing and future overseas assets and operations into it," Chatterjee said.
Addressing a news conference, Chatterjee said the company will use the Singapore-based Tata Steel Global to raise funds for international acquisitions of smaller steel makers and mines.
He said the find size and mode of raising are yet to be decided, but said the company was looking for acquisitions in coal and iron ore space worldwide – Tata Steel has now increased its geographical sperd.
Tata Steel, he said, had already formalised plans to raise Rs10,000 crore ($235 million) in debt as part of a Rs12,000 crore expansion in India. Nearly half of the planned investment, which will add three million tonne capacity, is being generated internally, he added.
Besides Corus, its largest overseas acquisition, Tata Steel owns Tata Steel Thailand and NatSteel Asia. It is setting up a ferrochrome unit in South Africa and has signed a memorandum of understanding (MoU) with the Vietnam government for setting up a 4.5 million tonne per annum steel plant.
Chatterjee said Tata Steel has acquired stakes in two coal mines in Mozambique and one in Australia. It also has stakes in an iron ore mine in Ivory Coast and has entered into a joint venture in Oman for limestone mining, adding, the company is now looking to acquire additional raw material assets abroad.
Tata Steel, meanwhile, reported a 22 per cent jump in first-quarter (April-June 2008-09) profit, helped by higher volumes.
Excluding income from its UK unit Corus Group, net profit for the quarter rose to Rs1,488 crore ($350 million) from Rs1,220 crore a year ago.
Sales rose 42.3 per cent to Rs6,177 crore, the company said in a filing with the Bombay Stock Exchange.
The Tata Steel-Corus combine will have a capacity to produce 25.6 million tonnes of finished steel annually.