Steel With ₹6,000-cr bid, Tata Steel leads race to buy Usha Martin
Tata Steel has placed an aggressive bid of ₹6,000 crore to acquire Kolkata-based Usha Martin, a specialty steel producer with a production capacity of 1 million tonnes in Jamshedpur. The promoters of Usha Martin are selling the steel business to pare the Group’s debt.

“Tata Steel had a meeting with Usha Martin officials in Kolkata on Wednesday and in all probability they will outbid JSW Steel, which has placed a bid of ₹5,500 crore,” said sources close to the development.

Anil Agarwal-owned Vedanta, which has entered the steel business with the recent acquisition of Electrosteel through the NCLT-driven insolvency process, is also believed to be in the race to acquire Usha Martin, he added.

Usha Martin is one of the largest wire-rope manufacturers in the world and leading specialty steel manufacturer in India. The company set up its first long product plant in 1974 near Jamshedpur.

The plant uses high-quality iron ore and coal from captive mines, enabling it to achieve consistent quality in steel products. Former SEBI Chairman GN Bajpai is the Chairman of Usha Martin.

Eye on synergy

Though the price being quoted is a bit high, it makes business sense as Tata Steel can work out synergies given that the Usha Martin facility is close to its mother plant in Jamshedpur, said an analyst. Tata Steel can enhance its profit margin by ramping up the production at Usha Martin, diverting a portion of its 10-mt capacity in Jamshedpur to produce specialty steel, he added.

With a history of over 50 years, Usha Martin also has a global base for wire rope manufacturing with facilities in the UK, Dubai and Bangkok.

The plant mostly caters to clients from the automotive, heavy earth-moving equipment and oil and gas sectors.

As of March-end, Usha Martin had a debt of about ₹3,700 crore. Last fiscal year, it trimmed losses to ₹282 crore from ₹354 crore a year earlier. However, revenue rose 24 per cent to ₹4,038 crore (₹3,246 crore) last fiscal year.