CORPORATE RESTRUCTURING – TATA STEELS

Abstract

Trading conditions had rapidly deteriorated in UK and Europe which is evident from the fact the number of employment has reduced from 55K in 1990s to 15K 2014 and contribution of steel industry to the whole economy has also declined, from 0.5 per cent of total output in 1990 to the current total of 0.1 per cent. There are multiple factors responsible for the loss in steel making business in UK  Global Overcapacity. High Energy cost and business rate in UK. Currency volatility. Many of the governments had imposed anti-dumping duties on Chinese import but UK government had voted against increased tariffs on imported Chinese steel due to its free trade policies. With the Tatas determined to find a best possible solution to UK Operations, it can will be only be painful waiting game until they find a solution and negotiations take their course. But whether it sells or shuts its operation of Tata Steel UK, it will slip back to the rank of around 20 among the world’s largest steel producer but that will leave them with a profitable and healthy balance sheet.