Tata Steel funds arm's capex, acquires new shares for 540 mln rupees

30 August 2022

Tata Steel Ltd has funded capital expenditure of its wholly-owned subsidiary Tata Steel Mining by acquiring freshly issued equity shares of the latter for 540 mln rupees.

Tata Steel said in a stock exchange filing today that the subsidiary company issued 28.2 mln equity shares of face value of 10 rupees at a premium of 9.15 rupees per share on a preferential basis to Tata Steel on Monday.

The cash paid by Tata Steel for the issue this will be utilised by Tata Steel Mining for capital expenditure purposes. Tata Steel holds 100% equity in the subsidiary company and the equity holding went up to 850.12 mln shares after Monday's preferential share issue.

Prior to this transaction, Tata Steel has paid Tata Steel Mining 6.45 bln rupees during the current financial year for acquiring 336.85 mln shares issued by the latter on a preferential basis at a price of 19.15 rupees a share which included a premium of 9.15 rupees a share.
 
This was done to fund the subsidiary company's acquisition of 100% shares of Rohit Ferro-Tech and was done in two tranches -- one in April and the second one in June.