Tata Corus Deal - Where Did They Go Wrong?

Abstract

Since the beginning of the 21st century, acquisitions have become an exclusive trend in the global steel industry. This is clear evident from the increasingly growing number of deal values through mergers&acquisitions resulting with more corporate integration especially with existing undertaking of intense globalization. Indian steel companies have emerged among the largest steel producers in the world by keeping their footprint in global steel map. Some Indian companies like Mittal steel, Tata steel, have made significant overseas acquisitions including Arcelor by Mittal, and Corus by Tata steel as efforts to internationalize their operations, by analysing the competitive dynamics on the global stage. The following study focuses on the key motive drivers and evaluates the impact of Corus acquisition by Tata steel from being perceived as a win-win deal to a deal from hell. This case study is based on secondary data including company reports, financial performances, newspapers articles, magazines, and the web. This case has been analysed from two different perspectives i.e., the strategic approach and the financial approach. Since the study is based on secondary data, it has its own limitations in terms of those aspects which are not revealed by the companies and the other information which though are in the public domain have certain biases attached.