Corus Group
From Wikipedia, the free encyclopedia
| Corus | |
|---|---|
 |
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| Type | Subsidiary |
| Founded | Koninklijke Hoogovens N.V. in 1918 British Steel Corporation in 1967 Merger of British Steel & Koninklijke Hoogovens 1999 |
| Headquarters |  London, England, UK |
| Key people | Philippe Varin, CEO. Rauke Henstra, Chief Operating Officer (COO) |
| Industry | Steel |
| Products | Steel |
| Revenue | £10,142 million (2005) |
| Operating income | £680 million (2005) |
| Net income | £451 million (2005) |
| Employees | 50,000 |
| Parent |  Tata Steel, member of Tata Group |
| Website | www.corusgroup.com |
Corus, is part of the Tata Group and together with Tata steel they are the world's fifth largest steel producer, Corus is headquartered in London, it was formed from the merger of Koninklijke Hoogovens N.V. with British Steel Plc on 6 October 1999. The company was taken over by the Tata Group on 2 April 2007.
From 1 January 2008 a new structural and management reorganisation took effect. Corus is now structured into three divisions. These are:
- Strip Products Division,
- Long Products Division,
- Distribution and Building Systems Division
It has major integrated steel plants at Port Talbot in South Wales; Scunthorpe, North Lincolnshire; Teesside, Cleveland (all in the United Kingdom) and IJmuiden in the Netherlands. It also has rolling mills situated at Shotton, North Wales (which manufactures Colorcoat products), Trostre in Llanelli, Llanwern in Newport, South Wales, Rotherham and Stocksbridge, South Yorkshire, England, Motherwell, North Lanarkshire, Scotland, Hayange, France, and Bergen, Norway. In addition it has tube mills located at Corby, Stockton and Hartlepool in England and Oosterhout, Arnhem, Zwijndrecht and Maastricht in the Netherlands. Group turnover for the year to 31 December 2005 was £10.142 billion. Profits were £580 million before tax and £451 million after tax.
On 16 March 2006 Corus announced that it had signed a letter of intent to sell its aluminium rolled products and extrusions businesses to Aleris International, Inc. for £570m. Corus would retain its smelting operations and supply Aleris under a long-term agreement. On 1 August, the sale to Aleris Europe was completed. Primary aluminium production remains with Corus; however, a letter of intent for its sale has been signed.
Corus is the sponsor of the Corus chess tournament in the Netherlands and the UK triathlon team.
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[edit] History
[edit] British Steel
British Steel Corporation was a large British steel producer, consisting of the assets of former private companies which had been nationalised on July 28, 1967 by the Labour Party government of Harold Wilson.
In 1971 British Steel sponsored Sir Chay Blyth in his record-making non-stop circumnavigation against the winds and currents, known as 'The Impossible Voyage'. In 1992, they sponsored the British Steel Challenge, the first of a series of 'wrong way' races for amateur crews.
The British Steel Act 1988 was passed by the Conservative government of Margaret Thatcher to privatise British Steel. This was achieved on 5 December 1988.
It merged with the Dutch steel producer Koninklijke Hoogovens to form Corus Group on 6 October 1999. [1] at the time forming the third largest producer of steel behind POSCO of South Korea and Nippon Steel of Japan. British Steel formed about two-thirds of the merged group.
[edit] The Mittal Affair: "Cash for Influence"
Controversy ensued as Plaid Cymru MP Adam Price exposed the link between UK prime minister Tony Blair and steel magnate Lakshmi Mittal in the Mittal Affair, also known as 'Garbagegate' or Cash for Influence.[1][2] [3] Mittal's LNM steel company, registered in the Dutch Antilles and maintaining less than 1% of its 100,000 plus workforce in the UK, sought Blair's aid in its bid to purchase Romania's state steel industry. [4] The letter from Blair to the Romanian government, a copy of which Price was able to obtain, hinted that the privatisation of the firm and sale to Mittal might help smooth the way for Romania's entry into the European Union.[5]
The letter had a passage in it removed just prior to Blair's signing of it, describing Mittal as "a friend."[6]
In exchange for Blair's support Mittal, already a Labour contributor, donated £125,000 more to Labour party funds a week after the 2001 UK General Elections, while as many as six-thousand of Welsh steelworkers were laid off that same year, Price and others pointed out.[7] Mittal's company, then the fourth largest in the world, was a "major global competitor of Britain's own struggling steel industry, Corus, formerly known as British Steel." [8] Corus and Valkia Limited were two of the primary employers in South Wales, particularly in Ebbw Vale, Llanwern, and Port Talbot.[9].
[edit] Koninklijke Hoogovens
Koninklijke Hoogovens was a Dutch steel producer founded in 1918. It was located in IJmuiden. This plant is now part of the Anglo-Dutch Corus Group steel company.
[edit] Takeover by Tata Steel
On January 30, 2007, Tata Steel, part of India's Tata Group, purchased a 100% stake in the Corus Group at 608 pence per share in an all cash deal, cumulatively valued at (USD 12.04 Billion) [10].
Tata surprised the credit default swap segment of the derivative markets by deciding to raise $6.17bn of debt for the deal through a new subsidiary of Corus called 'Tata Steel UK', rather than by raising the debt itself. Tata's security credit rating is investment grade, whereas the new subsidiary may not be. The higher risk associated with raising debt through a subsidiary with a lower credit rating prompted Fitch Ratings to downgrade its rating of the credit swap risks in the takeover to 'negative'. Fitch also stated that Corus' responsibility for the debt may lead to Corus' own unsecured debt rating being downgraded. This does not affect the rating of bonds issued by Corus which are secured debt.[11]
On November 19 2006, the Brazillian steel company CSN launched a counter offer for Corus at 475 pence per share, valuing it at $8.4 Billion.
On December 10 2006, Tata preemptively upped the offer to 500 pence (the “Revised Tata Acquisition”). Other than the increased offer price, the Revised Tata Acquisition was subject to the same terms and conditions as set out in the original offer.
On December 11 2006, CSN announced a formal offer for the Company at an offer price of 515 pence per Corus Share (the “CSN Acquisition”), valuing the deal at $ 9.6 Billion.. The CSN Acquisition would also be implemented by way of a scheme of arrangement and is subject to a pre-condition that either Corus Shareholders reject the Tata Scheme or the Tata Scheme is otherwise withdrawn by Corus or lapses. The Corus board promptly recommended both the revised offers to its shareholders.
On December 19 2006, Corus announced the following:
In the light of the competing offers for Corus by Tata Steel UK Limited (“Tata”) and CSN Acquisitions Limited (“CSN”), the Company announced on 12 December 2006 that the Corus Directors intended to propose resolutions to shareholders at each of the reconvened EGM and Court Meeting to be held on 20 December 2006 to adjourn those meetings. The Company also stated that it would announce a proposed date for those adjourned meetings in due course.
Also on December 19 2006, UK Watchdog the Panel on Takeovers and Mergers announced that the last date for each of Tata and CSN to announce revised offers for the Company, should they wish to do so, is 30 January 2007. They also warned that it would begin an auction procedure if the two remained in competition.[12]
On January 31, 2007, following the lack of agreement on an offer, the previously mentioned auction process was triggered. Following the conclusion of the auction process (at an unprecedented length of nine rounds) conducted by the Panel in accordance with Rule 32.5 of the Code (the "Auction"), Tata Steel announced the proposed acquisition of Corus Group at 608p per share, that being 5p more than CSN's top offer of 603p. The £6.7 billion deal includes £500 million of debt.
The Corus Group board recommended the acquisition to their shareholders later the same day.
[edit] See also
[edit] References
- ^ Plaid reveals Labour steel cash link Monday, 11 February, 2002, extracted 11-01-07
- ^ Lakshmi Mittal, steel mill millionaire Thursday, 14 February, 2002, extracted 11-01-07
- ^ Q&A: 'Garbagegate' Thursday, 14 February, 2002 extracted 11-01-07
- ^ Q&A: 'Garbagegate' Thursday, 14 February, 2002 extracted 11-01-07
- ^ Plaid reveals Labour steel cash link Monday, 11 February, 2002, extracted 11-01-07
- ^ Q&A: 'Garbagegate' 14 February, 2002, extracted 11-01-07
- ^ Plaid reveals Labour steel cash link Monday, 11 February, 2002, extracted 11-01-07
- ^ Q&A: 'Garbagegate' Thursday, 14 February, 2002 extracted 11-01-07
- ^ Steel firm condemns 'Mittal aid' Monday, 18 February, 2002, 14:47 GMT extracted 11-01-07
- ^ "India's Tata wins race for Corus", BBC, 31 January 2007. Retrieved on 2007-11-26.
- ^ Ryan, Jennifer. "Tata Debt for Corus Leaves Derivative Trades in Lurch", Bloomberg, 25 October 2006. Retrieved on 2006-10-25.
- ^ BBC NEWS | Business | Watchdog sets Corus bid deadline
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