Kalyani in talks for Corus arm

The Kalyani group had held high-level talks for a possible acquisition.

The Kalyani group has initiated negotiations with Corus for buying some of the Anglo-Dutch company's units. Corus is into strip products, long products and distribution, and building systems, with a total capacity of 18 million tonnes of steel a year.

Sources close to the development said the Pune-based Kalyani group had held high-level talks for a possible acquisition of a part of the business of the London-based Corus.

Both parties were expected to continue discussions this week as well, sources added. The acquisition will be independent of the Tata-Corus deal.

The deal, if it materialises, will be in line with Tata Tea-Tetley's, when the Tetley owners sold off their coffee business in early February 2000, and were left with the much larger tea business.

Tata Tea had announced the acquisition of Tetley in the end of February. The Corus Group had agreed to sell most of its aluminium assets in March.

The details of the units that may be taken over by the Kalyani group could not be ascertained. When contacted, a Corus spokesperson said, "We are not commenting on market rumours."

The Kalyani group spokesperson said she could not comment on this as Chairman Baba N Kalyani and Bharat Forge Joint MD Amit Kalyani were "in Europe."

The Kalyani group also owns Kalyani Steel, which mainly produces forging quality steel to meet the group's in-house requirements.

Tata Steel did not go beyond its announcement last week that it was looking at opportunities "including Corus." There has been speculation that the bid may wait until Corus pays its interim dividend on October 16.

Meanwhile, Commerce and Industry Minister Kamal Nath today supported the Tata bid. "Why not? Tata is one of our leading companies and they must go global. Today, it is not merely a story of trade flows; it is a question of investment, both ways," he said.