UK minister Sajid Javid meets Tatas’ Mistry in Mumbai
07 Apr 2016
Seeking to find a buyer for Tata Steel's UK operations and save thousands of jobs, British business secretary Sajid Javid flew to Mumbai this morning and met Tata Group chief executive Cyrus Mistry to discuss the contours of the sale process.
Javid had a two-hour meeting with Mistry and other top officials at Bombay House, the iconic headquarters of the Tata Group, which has put its steel operations in UK on the block after grappling with huge losses.
Neither the minister nor Tata Group officials spoke to the large posse of reporters including from the British media, who were waiting since morning outside the meeting venue.
A Tata Steel spokesman said he has nothing to share with the media.
Javid, who also met Tata Steel's group executive director Koushik Chatterjee, is understood to have discussed the broader contours of the sale process, and is said to have pressed upon the Tatas to ensure that there were no job losses.
Tata Steel UK employs around 15,000 people and the British government is keen to save these jobs in an already bad economic environment, especially for the steel industry which once was among the most prominent in the country.
The meeting comes within a week of the Tatas putting up for sale the British operations of Tata Steel, which it had acquired as Corus Steel in April 2007 at the peak of the commodity price hike cycle for over $12 billion, but has never been able to turn it around.
The company says its UK operations have been badly hampered by high production costs in the country coupled with cheap Chinese imports amid weak demand.
Tata Steel Europe had announced plans to sell its UK steel business last week after a "strategic review" by its board, throwing the industry into chaos. The company, since the acquisition, has sunk over £3 billion into the UK plants that have been hit by a massive 30-per cent drop in demand since the 2008 global credit crisis.
The British government, in a statement on Wednesday, had said Javid would be meeting the Tatas in Mumbai after "constructive meetings in London with trade unions, the EEF (national manufacturers' organisation) and UK Steel this week". The labour unions have asked Javid to ensure that the Tatas make all out efforts to find a buyer for its plants.
Before he left for the hurriedly planned India trip, Javid had crucial talks with Indian-origin businessman Sanjeev Gupta of the Liberty Group, who has expressed interest in acquiring Tata Steel's embattled Port Talbot plant in South Wales (See: Liberty House boss Sanjiv Gupta may emerge as Tata Steel buyer). The plant alone employs over 4,000 and is the biggest steel unit in the British Isles.
Gupta reportedly said he was waiting for the Tatas to start the "sales process" and promised there will not be any major job cuts. Gupta's firm is conducting due diligence of the Tata Steel operations and has held talks with the Tata Group over the prospect of acquiring the unit.
"If we get involved in Port Talbot, we will only do so on the basis that we are confident there will not be any mass redundancies," Gupta said.
British Prime Minister David Cameron has been personally involved in trying to work out a solution to the crisis triggered as a result of cheap imports from China, falling global demand, high energy prices and a tougher tax regime than many rival nations.
But his government is not ready to impose higher tariffs on Chinese steel, which Gupta may ask for.
