Tata Steel has executed definitive agreements to acquire 100 percent equity shares of Brahmani River Pellets (BRPL) from Aryan Mining and Trading Corporation (AMTC) and other companies in the Moorgate Industries Group (MIG). The transaction is based on an enterprise value of BRPL of Rs900 crore plus closing adjustments and is subject to completion of certain condition precedents including regulatory approvals.
BRPL was originally established by MIG (MIG was formed on demerger from Stemcor Group of Companies as part of a UK court-approved restructuring in 2015), which continues to hold a significant stake in BRPL through its shareholding in AMTC. BRPL owns a 4mtpa pellet plant in Jajpur, Odisha, and 4.7mtpa iron ore beneficiation plant in Barbil, Odisha, connected through a 220km underground slurry pipeline.
Koushik Chatterjee, group executive director - finance and corporate and member of the Tata Steel board, said "The location of the BRPL assets makes this very strategic to Tata Steel especially to our Kalinganagar operations and has significant operating synergies to make our Kalinganagar plant even more competitive for the future. The iron ore from our captive mine in the Joda and Khondbond region will get transferred in future through the slurry pipeline and reduce freight costs significantly apart from the 4mtpa pellet plant and other infrastructure which will enhance the operating efficiency and reduce costs of blast furnace operations in Kalinganagar. To build a similar facility would have taken significant time and costs and therefore, this acquisition is very timely as we are looking to ramp up the capacity of the Phase 1 at Kalinganagar. This is also a demonstration of our commitment to the state and people of Odisha."
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