(ET)
Six months ago, Tata Steel shocked everyone with an aggressive play for Bhushan Steel. A second smaller acquisition followed. Ground zero in Odisha and Jharkhand to see whether India’s largest conglomerate has an iron grip in the east. How many times have you seen a $5-billion takeover get wrapped up within 72 hours flat? More importantly, how many times have you seen India’s oldest and largest business conglomerate work and deliver on such a timeline?
As you read this, the Tata finance team is busy negotiating with banks to raise $700 million of external commercial borrowings (ECB). This will refinance short-term loans raised to pay off Bhushan’s lenders as part of the Tata ‘fit for future’ programme that aims to bring down $1 billion of leverage in the next 12 months. It has already prepaid Rs 2,000 crore of the Rs 35,200-crore acquisition bill within six months of the takeover – its largest in India in its 111-year history.
