Tata Steel approves European steel JV with Thyssenkrupp

Tata Steel on Saturday said its board has approved joint venture (JV) with German steel major Thyssenkrupp AG to combine the European steel business of both the firms.

The JV between two of the world's major steel companies will combine Thyssenkrupp and Tata Steel's European steel operations to create Europe's second-largest steelmaker after steel tycoon Lakshmi N Mittal's ArcelorMittal.

"The Board of Tata Steel has approved the terms to create a 50:50 joint venture which will combine the European steel businesses of Tata Steel and thyssenkrupp AG and has adopted resolutions for the signing of the definitive agreement," Tata Steel said in a BSE filing.

The step follows the signing of a Memorandum of Understanding in this regard in September 2017. The formal execution of the definitive agreements, it said, is expected shortly.

Both the companies had in September last year announced plans to combine their European operations and form an equal joint venture.

German steel giant Thyssenkrupp has said last year that it expects its proposed joint venture with Tata Steel Europe to be finalised by the end of 2018.

The company plans to produce 35,000 million tonnes (mt)per annum of CRGO electrical steel used in transformers for power sector from the expanded factory, against the current capacity of 10,000 mt.

The company had said the new product line set-up will help in meeting the continuously increasing demand of cold rolled grain oriented in the Indian market.