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Tata Steel Ltd on Tuesday said it has withdrawn its plan to merge its subsidiaries Tata Metaliks Ltd and Tata Metaliks DI Pipes Ltd with itself.
In a statement to the BSE, Tata Steel said its committee of directors has agreed to apply for a recall of a Bombay High Court order passed on August 21, 2015, sanctioning the scheme of amalgamation.
“The decision is based on careful consideration of various factors, including inordinate delay in obtaining requisite regulatory and statutory approvals, along with significant dilution in the intended synergies that were envisaged in April 2013. With today's decision, Tata Metaliks will continue to operate as a subsidiary of Tata Steel," said Group Executive Director (Finance and Corporate) Koushik Chatterjee, Tata Steel.
The scheme was earlier recommended by the committee in April 2013 and approved in May 2014.
Under the earlier approved scheme, the swap ratio for public shareholders was four shares of Tata Steel for every 29 held in Tata Metaliks Ltd.
The company in its statement said the scheme is not effective at present.
“Tata Metaliks has been advised to consider withdrawing the scheme with a leave to re-file a fresh scheme of merger of Tata Metaliks and Tata Metaliks DI Pipes,” the statement said.
Tata Metaliks will continue to operate as a subsidiary of Tata Steel.
Tata Metaliks DI Pipes is a wholly-owned subsidiary of Tata Metaliks Ltd.
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