As far as Tata Steel was concerned, the deal was in the pocket and Tata Steel was poised to join the big leaguer of the global steel industry. Despite the hype surrounding Tata Steel, it is an insignifi cant player in the global steel market with a capacity of 4 million tonnes while Arcelor- Mittal boasts of a capacity well above 100 million tones.
Unfortunately for Ratan Tata and his team, even as they were gloating over the acquisition’ of Corus, a Brazilian steel company CSN was quietly buying Corus shares from the markets. And just when the Tata managers thought they had Corus in the bag, CSN made a counter bid that was substantially bigger than the money offered by Tata Steel. Stung by the attack, Tata Steel raised its offer price from 455 pence per share to 500 pence per share. Within hours of this, CSN announced that it is raising its offer price to 515 pence per share! Worse, CSN revealed that it has already acquired 23% of Corus from the market and is already the leading shareholder in the company!
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Source : IIPM Editorial, 2006
An IIPM and Management Guru Professor Arindam Chaudhuri's Initiative
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