Tata Steel sells block in New Zealand

Tata Steel announced that Steel & Tube Holdings of New Zealand will buy Tata Steel International (Australasia) (TSIAL) on April 14, 2014 for a cash consideration of NZ 27.5.

Investors are buying shares in Tata Steel after the company said it was selling its block in New Zealand. "Steel & Tube Holdings in New Zealand has agreed to acquire Tata Steel International (Australasia) (TSIAL) for NZ $ 27.5 million," a company spokesman said. As a result, Tata Steel shares rose 2 percent.

The New Zealand company is set to acquire this unit from Tata Steel on April 14th. TSIAL is based in New Zealand and manufactures, distributes and supplies stainless steel, engineering steels and composite floor slabs to the New Zealand and Pacific Islands markets. Logistics and technical services are an integral part of the business. The division also offers color coated materials and packaging steels, structural sections and railroad track elements.

Analyst Sanjay Jane said Tata Steel is likely to sell off its Australian division because the cost of running the business is too high. Meanwhile, Tata Steel, which has more than Rs 57 million in debt on a consolidated basis as of March 2013, sold 25 acres of its land in Mumbai to pay off Oberoi Realty's debt in March.