Tata, the giant Indian conglomerate, recently announced that it planned to pull out of its U.K. steel operations. The
Financial Times
, citing unnamed Tata insiders, said the company is only “going through the motions” of putting the unit up for sale and expects to shutter it if a buyer is not found by the company's board meeting at the end of April.
Tata is exploring a merger of its “highly efficient” Dutch plant with Germany's ThyssenKrupp,
the
FT
report said.
An unnamed source told the
FT
that while the U.K. business might have been sold if it could be combined with the Dutch business, but “no one wants the U.K. business on its own.”
A report in
The National
,
Abu Dhabi Media's English-language publication, said family issues may have driven Ratan Tata to make his ill-fated decision to invest in the British steel industry in 2007. That year, Tata acquired Corus, an Anglo-Dutch company that “was basically all that remained of the once mighty British Steel and its Dutch equivalent Hoogovens,” Ivan Fallon, former business editor of
The Sunday Times
, wrote in
The National.
In
The National
, Fallon recalled a family story Ratan Tata told him shortly after the 2007 acquisition. In the early 1900s, Ratan's grandfather approached the British colonial official in charge of extending India's railways about using steel provided by Tata. According to Ratan Tata, the official told his grandfather, “Mr. Tata, these railways will be built from the finest British steel made in Wales, Tyneside and Scotland. We don't want your cheap, inferior Indian stuff.” Fallon wrote, “Two generations later, [Ratan] Tata took great pleasure in buying the whole — literally — of the British steel industry, and spent £2 billion upgrading it.”
Fallon's article said Tata is losing £1 million a day on its British steel operations. (Sources:
Financial Times
, April 2-3, 2016;
The National
, April 4, 2016.)
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