Calcutta, July 16: Tata Steel has decided to sell its 50 per cent stake in HKS Scrap Metals Co — the Dutch ferrous and non-ferrous metal recycling firm — to Euro Scrap Alliance for an undisclosed amount.
“The transaction is in line with Tata Steel’s strategy of focusing on its core activities,” the world’s seventh largest steel maker said.
The company had exited its non-core aluminium business, which came along with the acquisition of Anglo-Dutch steel maker Corus Group Plc. Its subsidiary NatSteel Holdings had sold its stake in Malaysia-based Southern Steel Berhad in 2010. Last year, Tata Steel divested its entire stake in Australia’s Riversdale Mining to Rio Tinto.
Euro Scrap Alliance already holds 50 per cent in HKS. Founded in 1993, HKS has annual sales of about 400 million euros and employs around 180 people in six locations in the Netherlands.
The company processes over 1 million tonnes of ferrous and 100 thousand tonnes of non-ferrous scrap.
Tata Steel’s exit comes at a time the company is raising funds for expansion. It is setting up a 3-million-tonne plant at Kalinganagar in Odisha besides increasing capacity at Jamshedpur to 10 million tonnes. The company also needs to save cash for the European, operations which is going through a difficult phase because of the Eurozone crisis.