Swot Analysis of Tata Steel

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  • Topic: Steel, Corus Group, Tata Group
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SWOT Analysis of Tata Steel

Submitted by:
Shubham GOYAL
10903930, RE19B1A01
Assignment 1, MGT 511
Contents

1. About Tata Steel
2. Countries of operation
3. Major Acquisitions
4. Corus acquisition
5. About SWOT analysis
6. Strengths
7. Weaknesses
8. Opportunities
9. Threats

About Tata Steel

Tata Steel Limited (BSE: 500470) (formerly TISCO and Tata Iron and Steel Company Limited) is an Indian multinational steel-making company headquartered in Mumbai, India and a subsidiary of Tata Group. Its marketing headquarter is located at Tata Centre in Kolkata. It is the tenth-largest steel producing company in the world, with an annual crude steel capacity of 23.5 million tonnes, and the largest private-sector steel company in India measured by domestic production.

Tata Steel is a multinational corporation with operations in numerous countries. It largest plant is located in Jamshedpur, Jharkhand, India. In August 2007 Tata Steel acquired the UK-based steel maker Corus in what was, to date, the largest international acquisition by an Indian company. Tata Steel is listed on Bombay Stock Exchange and National Stock Exchange of India, and employs about 80,000 people.

Tata Steel is ranked 401st in the 2012 Fortune Global 500 ranking of the world's biggest corporations. It is the eighth most-valuable Indian brand according to an annual survey conducted by Brand Finance and The Economic Times in 2010. The company was recognized as the world's best steel producer by World Steel Dynamics in 2005. It has also been listed as World's most ethical companies by Forbes.

TISCo was established by Jamsetji Tata August 26, 1907. In year 1939, it had largest steel plant in the British empire. A modernization and expansion program was launched in year 1951. Later, the program was upgraded to 2 MTPA project. In 1990, it started expansion plan and established its subsidiary Tata Inc. in New York. The company changed its name TISCO to Tata Steel in year 2005.

Countries of operation

Tata Steel has a presence in around 50 countries with manufacturing operations in 26 countries. It has manufacturing operations in these locations: Asia
1. India
2. Malaysia
3. Vietnam
4. Thailand
5. Oman
Africa
1. Ivory Coast
2. Mozambique
3. South Africa
Australia
1. Central Queensland
North America
1. Canada
Europe
1. United Kingdom
2. The Netherlands
3. France

Major Acquisitions

1. NatSteel of Singapore acquisition in 2004 for $487 Million. 2. Corus acquisition in 2007 for $12.04 Billion.
3. GMAC of Thailand acquisition in 2009 for $1.75 Billion.

Corus Acquisition

On 20 October 2006 the board of directors of Anglo-Dutch steelmaker Corus accepted a $7.6 billion takeover bid from Tata Steel, the Indian steel company, at 455 pence per share of Corus. The following months saw a lot of negotiations from both sides of the deal. Tata Steel's bid to acquire Corus Group was challenged by CSN, the Brazilian steel maker. Finally, on January 30, 2007, Tata Steel purchased a 100% stake in the Corus Group at 608 pence per share in an all cash deal, cumulatively valued at USD 12.04 Billion. The deal is the largest Indian takeover of a foreign company and made Tata Steel the world's fifth-largest steel group.

* On October 20, 2006, Tata Steel announced that it had agreed to pick up a 100% stake in the Anglo-Dutch steel maker Corus at 455 pence per share in an all cash deal, cumulatively valued at GBP 4.3 billion (USD 8.04 billion). * On November 19, 2006, the Brazilian steel company CSN launched a counter offer for Corus at 475 pence per share, valuing it at $8.4 billion. * On December 11, 2006, Tata preemptively upped the offer to 500 pence, which was within hours trumped by CSN's offer of 515 pence per share, valuing the deal at $ 9.6 Billion. The Corus board promptly recommended both the revised offers to its shareholders. * On...
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