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Industrial Products India, Industrial Manufacturers & Suppliers
 




 
   
 
 
 

Tata Steel to take $1.6 bn charge

Tata Steel to take $1.6 bn charge on Europe woes

Tata Steel on Monday said it expects non-cash write down of goodwill and assets of around $1.6 billion due to poor macroeconomic condition in Europe, among others.

"...the company expects non-cash write down of the goodwill and assets in the consolidated financial statements for the year ended March 31, 2013 of around $1.6 billion," it said in a statement.

The impairment, it said, is primarily due to a weaker macroeconomic and market environment in Europe where apparent steel demand has fallen significantly in 2012-13 by almost 8 per cent "which in aggregate results in almost 30 per cent since the emergence of the global financial crisis in 2007".

"The above underlying condition is expected to continue over the near and medium term, and has led to the downward revision of cash flow expectations underlying the valuation of the European business," it said.

"The impairment also includes the effect of write down of assets in the ferro chrome business in South Africa and the mini blast furnace in Tata Steel Thailand which has been impacted by the high cost of raw material feedstock," it added.

The company, which is scheduled to announce its financial results for the year on May 23, however, said the non-cash write down is not expected to affect its financial covenants.

Tata Steel Group is among the top ten global steel companies with an annual crude steel capacity of over 26.5 million tonnes per annum (mtpa). It has operations in 26 countries.

 
     
 
   
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