January 30, 2007, Tata Steel purchased a 100% stake in the Corus Group at 608 pence per share in an all cash deal, valued at USD 12.04 Billion.

The deal is the largest Indian takeover of a foreign company and made Tata Steel the world's fifth-largest steel group.

'Tata Steel', formerly known as TISCO (Tata Iron and Steel Company Limited)

World's 56th largest and India's 2nd largest steel company with an annual crude steel capacity of 3.8 million tonnes.

Based in Jamshedpur, Jharkhand, India.

Part of the Tata Group of companies.

The company was recognized as the world's best steel producer by World Steel Dynamics in 2005.

Listed on BSE and NSE; and employs about 82,700 people (as of 2007).

Corus was formed from the merger of Koninklijke Hoogovens N.V. with British Steel Plc on 6 October 1999.

It has major integrated steel plants at Port Talbot, South Wales; Scunthorpe, North Lincolnshire; Teesside, Cleveland (all in the United Kingdom) and IJmuiden in the Netherlands.

Group turnover for the year to 31 December 2005 was £10.142 billion

Profits were £580 million before tax and £451 million after tax.

Prominent synergies that could arise from the deal were as follows :

• Tata Steel-low cost steel producer

• Corus -high value product manufacturer

• Tata- strong retail and distribution network in India and SE Asia.

• Powerful combination of high quality developed and low cost high growth markets.

• Technology transfer and cross-fertilization of R&D capabilities between the two companies that specialized in different areas of the value chain

Strong culture fit between the two organizations both of which highly emphasized on continuous improvement and ethics.

Tata steel's Continuous Improvement Program ‘Aspire’ with the core values trusteeship, integrity, respect for individual, credibility and excellence.

Corus's Continuous Improvement Program ‘The Corus Way’ with the core values : code of ethics, integrity, creating value in steel, customer focus, selective growth and respect for our people

In November 2006, Brazilian steel marker Companhia Siderúrgica Nacional (CSN) challenged Tata Steel's proposal for acquisition. They countered Tata Steel's offer of 455 pence per share by offering 475 pence per share of Corus

Tata decided to raise $6.17bn of debt through a new subsidiary of Corus called 'Tata Steel UK‘.

The higher risk associated with raising debt through a subsidiary with a lower credit rating prompted Fitch Ratings to downgrade its rating to 'negative‘.

On January 31, 2007, following the lack of agreement on an offer, an auction process was triggered.

CONCLUSION: Tata Steel announced the proposed

acquisition of Corus Group at 608p per share, that being 5p more than CSN's top offer of 603p. The final valuation of Corus was thus put at $12.04 Billion.

On October 20, 2006, Tata Steel announced that it had agreed to pick up a 100% stake in the Anglo-Dutch steel maker Corus at 455 pence per share in an all cash deal, cumulatively valued at GBP 4.3 billion (USD 8.04 billion).

On November 19, 2006, the Brazilian steel company CSN launched a counter offer for Corus at 475 pence per share, valuing it at $8.4 billion.

On December 11, 2006, Tata preemptively upped the offer to 500 pence, which was within hours trumped by CSN's offer of 515 pence per share, valuing the deal at $ 9.6 Billion. The Corus board promptly recommended both the revised offers to its shareholders.

On December 11, 2006, CSN announced a formal offer for the Company at an offer price of 515 pence per Corus Share, valuing the deal at $ 9.6 Billion.

Also on December 19, 2006, UK Watchdog the Panel on Takeovers and Mergers announced that the last date for each of Tata and CSN to announce revised offers for the Company, should they wish to do so, is 30 January 2007.

On January 31, 2007 Tata Steel won their bid for Corus after offering 608 pence per share, valuing Corus at $11.3bn

$3.5–3.8bn infusion from Tata Steel ($2bn as its equity contribution, $1.5–1.8bn through a bridge loan)

$5.6bn through a LBO ($3.05bn through senior term loan, $2.6bn through high yield loan)

A new board was formulated with representation from both the companies to provide a common platform for strategy and integration.

• Mr. R.N. Tata will be the Chairman of Tata Steel and Corus

• Mr. Jim Leng will be the deputy chairman of Tata Steel and Corus

• Mr. B Muthuraman, Mr. Ishaat Hussain and Mr. Arun Gandhi to join the Corus board

A 'Strategic and Integration Committee' was formulated to develop and execute the integration and further growth plans.

Appropriate cross functional teams were formed under this committee to look into specific issues.

It's been just short of five years since Tata Steel acquired Corus (now Tata Steel Europe) for over $12 billion.

Deal increased the company's steel producing capacity by five-fold.

Bad Economy:• Tata Steel's European operations have had

a torrid time since the acquisition.

• The UK has seen steel production fall every year since 2007.

• Steel consumption in the two geographies(UK and Netherlands) is still well short of the highs of 2007.

Volatile demand from user industries such as automobiles, consumer durables and capital goods in the region, resulted from- the setbacks of the credit crisis & resulted in- shaky realizations on steel over the last three years.

Tata Steel's Indian operations have accounted for a lion's share (60 to 96 per cent) of the company's total profits (excluding extraordinary items) between FY08 and FY11.

Net sales between FY08 and FY11 fell from Rs 131,000 crore to Rs 118,000 crore.

In an attempt to insulate the European arm from volatile input costs, Tata Steel has in the past five years invested in iron ore and coking coal mines in Canada, Africa and Australia.

These moves are expected to begin boosting margins of the European operations over the next two years.

The European shake-up coupled with contractual buyers walking away from a deal had also pushed Tata Steel to act quickly and sell its unprofitable three-million-tonn-a-year Teesside Casting operations for a bargain price of about $700 million.

One of Tata Steel's backward integration moves to secure iron ore also resulted in a windfall gain.

Domestic capacity additions are a key step to better insulating Tata Steel from volatile global raw material costs

While the benefits accruing from captive sourcing for Corus will result in better margins, Europe is likely to remain a challenging market for volume expansion given it is a capacity-heavy region.

Therefore, the Indian operations once again to drive growth for the company over the next five years.

The India operation's gross debt has moved from Rs 18,000 crore in FY08 to Rs 28,000 crore at the end of FY11, mainly on account of borrowings to fund this project.

Despite the company's turbulent journey, investors in the Tata Steel stock have fared as well as the Sensex in the last four years.

The stock's 21 per cent absolute gain since February 2007 matches that of the broader market.

Net debt fell from $10.43 billion in June, 2010 to $9.13 billion in March, 2011

Tata Steel Group recorded profit after tax of Rs5,347 crores in Q1 FY’12, almost three times the profit of Rs1,825 crores recorded in Q1 FY’11

Market Price of TATA Steel in rupees