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Tatas sweeten Corus takeover bid to $9.2 bn
Tata Steel raised its bid for Anglo-Dutch steelmaker Corus to an agreed 4.7 billion pounds ($9.2 billion) on Sunday as it seeks to head off a potential counterbid from Brazil's CSN.
The new cash offer, 500 pence per Corus share, is up from a previous cash bid of 455 pence, the two companies said.It also trumps an indicative approach by Companhia Siderurgica Nacional (CSN) of 475 pence per share.The terms "value the entire existing issued and to be issued share capital of Corus at approximately 4.7 billion pounds," Corus Group Plc and Tata Steel said in a joint statement.
Corus Chairman Jim Leng described the revised offer as a "substantial increase" from before."Accordingly, the Corus board are pleased to recommend this to Corus shareholders," Leng said in the statement.Tata Steel Chairman Ratan Tata, for his part, said he was confident of his company's latest approach."We remain convinced of the compelling strategic rationale of this partnership and the revised terms deliver substantial additional value to Corus shareholders," he said.
Tata, advised by ABN Amro and Deutsche Bank, said it planned to raise the extra funding through two letters of credit facility agreements dated Dec. 5 and Dec. 10 between, among others, Tata Steel Asia Holdings Pte Ltd, Tata Steel, Standard Chartered Bank and Standard Chartered First Bank of Korea.
Tata Steel won approval from Corus on Oct. 20 for its initial offer to create the world's fifth-largest steelmaker. A successful bid would be India's largest-ever foreign takeover.
CSN, however, remained in the picture. Sources familiar with the matter told Reuters last week that the company had completed due diligence on Corus Group but had yet to reach agreement with the steelmaker's pension trustees.
The company said its proposal would also create a top-five steelmaker with an initial annual production capacity of 24 million tonnes. Output would surge to about 50 million tonnes a year because of expansion projects already under way in Brazil.CSN declined to comment on the revised bid by Tata Steel.
A source familiar with the situation told Reuters that the Corus board met on Sunday afternoon to consider the CSN approach but no firm offer from the Brazilian company had been put on the table so far.
Corus and Tata Steel said further details of the revised offer would be released in a circular, which would be posted to Corus shareholders shortly. Corus shareholders last week voted to adjourn a meeting to Dec. 20.Credit Suisse was the lead financial adviser to Corus.The bids for Corus follows Mittal Steel's $32 billion acquisition of rival Arcelor this year.
Govt limits power IPO size at 10% of post-issue cap
The government has decided to limit the size of the initial public offers (IPOs) of four state-run power companies to 10% of their post-issue capital in first phase and the process is to be completed by March 2007. The companies would be expanding their capital by issuing fresh shares that would account for 10% of the capital in the first phase, power secretary R V Shahi said.
The government has cleared the IPOs of Power Finance Corporation (PFC) National Hydroelectric Power Corporation (NHPC), Rural Electrifiction Corporation (REC) and Power Grid Corporation of India (PGCIL).
For NHPC and PGCIL, the Cabinet has approved issuing of fresh shares to the tune of 24% of its capital, while for REC the clearance is for 20% in tranches. For PFC, the Cabinet approval is for 10.22%.
NHPC has even got the nod to sell its shares in the international markets. Shahi said PFC’s IPO would be the first one to hit the market in January or at most February. “We would like to complete the entire process by March,” he added.
Of these companies, the IPO of NHPC could be the largest. With a share capital of Rs 10,349 crore, NHPC would be able to offer shares worth up to Rs 2,500 crore at a premium. The company has an authorised capital of Rs 15,000 crore.
For PFC, it would be another shot at the IPO. Its first attempt at entering the market was aborted as the government went back on its decision to disinvest 5% shares in the company, along with the IPO, following stiff opposition from its allies.
Tata Steel raised its bid for Anglo-Dutch steelmaker Corus to an agreed 4.7 billion pounds ($9.2 billion) on Sunday as it seeks to head off a potential counterbid from Brazil's CSN.
The new cash offer, 500 pence per Corus share, is up from a previous cash bid of 455 pence, the two companies said.It also trumps an indicative approach by Companhia Siderurgica Nacional (CSN) of 475 pence per share.The terms "value the entire existing issued and to be issued share capital of Corus at approximately 4.7 billion pounds," Corus Group Plc and Tata Steel said in a joint statement.
Corus Chairman Jim Leng described the revised offer as a "substantial increase" from before."Accordingly, the Corus board are pleased to recommend this to Corus shareholders," Leng said in the statement.Tata Steel Chairman Ratan Tata, for his part, said he was confident of his company's latest approach."We remain convinced of the compelling strategic rationale of this partnership and the revised terms deliver substantial additional value to Corus shareholders," he said.
Tata, advised by ABN Amro and Deutsche Bank, said it planned to raise the extra funding through two letters of credit facility agreements dated Dec. 5 and Dec. 10 between, among others, Tata Steel Asia Holdings Pte Ltd, Tata Steel, Standard Chartered Bank and Standard Chartered First Bank of Korea.
Tata Steel won approval from Corus on Oct. 20 for its initial offer to create the world's fifth-largest steelmaker. A successful bid would be India's largest-ever foreign takeover.
CSN, however, remained in the picture. Sources familiar with the matter told Reuters last week that the company had completed due diligence on Corus Group but had yet to reach agreement with the steelmaker's pension trustees.
The company said its proposal would also create a top-five steelmaker with an initial annual production capacity of 24 million tonnes. Output would surge to about 50 million tonnes a year because of expansion projects already under way in Brazil.CSN declined to comment on the revised bid by Tata Steel.
A source familiar with the situation told Reuters that the Corus board met on Sunday afternoon to consider the CSN approach but no firm offer from the Brazilian company had been put on the table so far.
Corus and Tata Steel said further details of the revised offer would be released in a circular, which would be posted to Corus shareholders shortly. Corus shareholders last week voted to adjourn a meeting to Dec. 20.Credit Suisse was the lead financial adviser to Corus.The bids for Corus follows Mittal Steel's $32 billion acquisition of rival Arcelor this year.
Govt limits power IPO size at 10% of post-issue cap
The government has decided to limit the size of the initial public offers (IPOs) of four state-run power companies to 10% of their post-issue capital in first phase and the process is to be completed by March 2007. The companies would be expanding their capital by issuing fresh shares that would account for 10% of the capital in the first phase, power secretary R V Shahi said.
The government has cleared the IPOs of Power Finance Corporation (PFC) National Hydroelectric Power Corporation (NHPC), Rural Electrifiction Corporation (REC) and Power Grid Corporation of India (PGCIL).
For NHPC and PGCIL, the Cabinet has approved issuing of fresh shares to the tune of 24% of its capital, while for REC the clearance is for 20% in tranches. For PFC, the Cabinet approval is for 10.22%.
NHPC has even got the nod to sell its shares in the international markets. Shahi said PFC’s IPO would be the first one to hit the market in January or at most February. “We would like to complete the entire process by March,” he added.
Of these companies, the IPO of NHPC could be the largest. With a share capital of Rs 10,349 crore, NHPC would be able to offer shares worth up to Rs 2,500 crore at a premium. The company has an authorised capital of Rs 15,000 crore.
For PFC, it would be another shot at the IPO. Its first attempt at entering the market was aborted as the government went back on its decision to disinvest 5% shares in the company, along with the IPO, following stiff opposition from its allies.
posted by SY at 1:30 PM
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