CSN, associates scale up holding in Corus to 23%

Even as Tata Steel mulls over its next move in the race for Corus Group, its rival suitor Companhia Siderurgica Nacional (CSN), along with bankers and brokers allied to it, has scaled up their holding in the Anglo-Dutch steel company to a little less than 23 per cent.

The combined holding of CSN and its allies stood at 19.5 per cent on November 25.

The increased holding comes from UBS AG, which has emerged as the largest shareholder in Corus with 10.23 per cent stake. UBS is acting as a joint broker to CSN for this deal.

According to an intimation to the London Stock Exchange, Corus has informed the bourse that UBS held, through its business group and legal entities, 10.23 per cent in the company on December 11.

CSN's other financial advisors are Barclays Capital and Goldman Sachs, which held 4.7 per cent and 4.01 per cent in Corus respectively. Further, the Brazilian steelmaker holds a 3.8 per cent stake in Corus.

Investment bankers said the combined holding was inching towards the crucial 25 per cent that could block Tata Steel's offer at the extraordinary general meeting (EGM) if such a situation were to arise.

According to the rules, a resolution pertaining to the bid would have to garner support from 50 per cent of shareholders and 75 per cent of shares at the EGM, which has been adjourned to December 20. Corus has around 158,000 registered shareholders.

Institutional investors account for around 90 per cent of the total shareholders. The remaining 10 per cent is held by individual investors.

As of November, the major shareholders in the Corus group apart from the ones connected to Corus are Standard Life Investments at 7.81 per cent, Legal & General Investment Management at 3.82 per cent, Lehman Brothers at 3.45 per cent and Capital Group at 3.05 per cent.

In its revised offer, Tata Steel has disclosed that Tata Ltd, a wholly owned subsidiary of Tata Sons, holds 2,125 Corus shares.

However, since Corus shares held either by members of the Tata Steel group or by Tata Ltd are excluded from the definition of scheme shares, Tata Steel will not be entitled to vote these shares at the court meeting.

As on December 7, Deutsche Bank, the financial advisor to Tata Steel, has 4,786,061 Corus shares.