Tata Steel LtdNSE 0.84 % has decided to sell off an iron ore mine in South Africa to IMR Metallurgical Resources AG, a Switzerland-based metals and mining group, for 366 million South African rand or $25.6 million. This amounts to a deal size of about Rs 188 crore. The transaction is expected to be closed in around 12 months.
“A wholly owned indirect subsidiary of the company, TS Global Minerals Holdings Pte Ltd, on October 18, 2018, entered into an agreement to divest its entire stake in its wholly owned step down subsidiary Black Ginger 461 Pty Ltd,” Tata Steel said in a notification to the BSE recently.
The latter in turn holds 64% in Sedibeng Iron ore Pty Ltd, South Africa which is the operating company. In its regulatory filing, Tata Steel added: “The stake has been divested to IMR Asia Holding Pte Ltd which is a group company of IMR Metallurgical Resources AG”.
The proceeds from the sale will factor in adjustments for working capital and closing cash balance, Tata Steel said. The mining operations reported a revenue of Rs 839.86 crore in the financial year 2017-18.
While Tata Steel is scaling down its operations in South Africa, IMR, a leading supplier of raw materials to the steel industry and an international trading company is increasingly looking at widening its presence in India. IMR has bid for assets undergoing the auction process under the National Company Law Tribunal, including FACOR.
A senior IMR official told ET on Tuesday, the company is keen on building up its presence in India, which is tipped to emerge as a leading producer and consumer of steel.
