The statement released by the Department of Investment and Public asset management (DIPAM) states that the Government approves Tata steel to acquire Neelachal Ispat Nigam Ltd which is located in Odisha. Tata steel made the highest bid of ₹12,100 crores.
Neelachal Ispat Nigam Ltd is a joint venture between four CPSEs-MMTC, NMDC, BHEL, MECON – and two-state PSEs – OMC and IPICOL in Kalinganagar, Odisha, that operates an integrated steel factory with a capacity of 1.1 MT.
Neelanchal has been losing money and the facility has been closed since March 2020,with debt and liabilities totalling more than Rs. 6,600 crores as of March 2021. After signing the share purchase agreement, Tata Steel is agreed to pay 10% of the bid amount.
Tata Sons’ company intends to make the defunct Neelachal factory in Odisha the new hub for its long steel business. The government also stated that this is India’s first privatisation of a public sector steel production firm, describing the transaction’s success as a win-win scenario for all parties involved.