Tata Steel today said it has terminated an agreement to acquire Odisha-based iron ore pellet manufacturer Brahmani River Pellets Limited for Rs 900 crore.
“The transaction has not been completed within the long stop date, due to non-fulfilment of certain conditions precedent by the sellers, obtaining the necessary regulatory approvals from the Reserve Bank of India, settlement of proceedings under FEMA by the Directorate of Enforcement, approval from the Income Tax authorities, etc,” Tata Steel said in a filing to BSE.
Tata Steel in December had announced the signing of an agreement to acquire Brahmani River Pellets Ltd (BRPL) for Rs 900 crore in an all-cash deal. “This has reference to our release dated December 23, 2016, intimating about the execution of definitive agreement to acquire 100 percent equity shares of..BRPL from the selling entities being Aryan Mining Trading Corp Pvt Limited and companies in the Moorgate Industries Group,” Tata Steel said.
Tata Steel had said the deal, subject to regulatory approvals, was expected to close in four months. The company had said that it also needs approval from RBI and other regulatory bodies to restructure BRPL’s balance sheet, including shareholders loan and advances.
BRPL was incorporated on August 24, 2006 and is engaged in the business of acquisition and beneficiation of iron ore and the manufacture and sale of iron ore pellets. Pellets are used as agglomerates in the iron making process. The company was originally established by the Moorgate Industries Group (MIG), which continues to hold a significant stake in BRPL through its shareholding in AMTC. MIG was formed on demerger from the Stemcor Group of Companies as part of a UK court-approved restructuring in 2015.