At 13:30 hrs Tata Steel was quoting at Rs 485.45, down Rs 33.50, or 6.46 percent.
Tata had given unions a lot of commitments ahead of the intended merger but it has to be said, this joint venture with Thyssenkrupp was regarded as essential for the future of its United Kingdom business.
Under the old plans, Thyssenkrupp Materials would have held a 50 percent stake in the planned JV with Tata Steel but under the revised proposal it will reintegrate its steel business in the third quarter, resulting in a net loss for the year. But after two profit warnings, Thyssenkrupp's share price is too low to make this deal work, leaving Kerkhoff's scrambling for a Plan B, these people said.
Tata's said in a separate statement that both "partners assume with deep disappointment that the European Commission will not approve the joint venture".
The management at Tata Steel had also said that, on a pro-forma basis, the turnover of the JV firm as on last reporting date would be around 17 billion euro and pre-synergy Ebitda (earnings before interest, tax, depreciation and amortisation) about 1.5 billion euro.Читайте также: Trump may aid his own impeachment: Schiff
Stressing that its European operations have improved over the years, he said, "we have taken some hard calls and in many different ways we are in a better place than we were three four years ago when we started the JV discussion".
Assuming the merger is now not going ahead, Thyssenkrupp said it was now considering a new strategy, which could include a partial listing of its lifts division. Addressing the media over a concall, Tata Steel managing director TV Narendran said, "while we are disappointed that the JV has not happened, things have also improved in the last three-four years, and we will continue to pursue other options". "Compared to a United States dollars 1-billion target, we done much more, in fact double that in the last six months at the gross level and we will focus on internal generation and also look at more asset sales", he said.
Unions meanwhile warned it meant another period of uncertainty for steelworkers and said it was "time for calm heads and a clear focus" on the future of Tata in Europe.
However, the Tata chief said he was "concerned" about increasing energy costs in the UK. The reaction from shareholders was telling: Thyssenkrupp surged the most on record while Tata slumped as much as 7.7% in Mumbai.
The Essen-based company said further concessions would have weakened the venture to such an extent that it would have no longer made business sense.При любом использовании материалов сайта и дочерних проектов, гиперссылка на обязательна.
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