Tata Steel announced that it had acquired 300 crores in shares in Neelachal Ispat Nigam Ltd, an indirect subsidiary of the company.

Tata Steel subscribed to 4,68,75,000 equity shares of Rs10 each on February 21, 2023, at a premium of Rs54 per share, for a total investment of Rs300 crore in Neelachal Ispat Nigam Ltd under Tranche 1.

“On February 21, 2023, the Company acquired 4,68,75,000 equity shares of the face value of ten rupees each at a premium of 54 rupees per share of NINL for an aggregate value of 300 crores, being Tranche 1 of the investment in the equity shares of NINL,” the company stated in a regulatory filing.

The funds will be used to meet NINL’s working capital and capex needs, including the establishment of an iron and steel plant in Kalinganagar, the repayment or prepayment of liabilities, and other general corporate purposes.

Tata Steel’s stake in Neelachal Ispat Nigam Ltd increased from 1.88 per cent to 5.23 per cent following the acquisition.

NINL operates a 1.1 MTPA integrated iron and steel plant in Kalinganagar, Odisha, as well as iron ore mines with a 90 MT reserve. In the fiscal year 2021-22, it had a revenue of 257.58 crores.

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Tata Steel Long Products, a listed step-down subsidiary of Tata Steel, completed the acquisition of 93.71 per cent of Neelachal Ispat Nigam Limited (NINL) in July last year.

Tata Steel Long Products was declared the winning bidder in a process run by the Department of Disinvestment & Public Asset Management (DIPAM) for the one million tonnes (mt) NINL, an asset owned by central and state public sector undertakings, for consideration of Rs 12,100 crore.