Tata Steel Ltd has called off plans to sell a majority stake in its southeast Asia steel business to China's state-run HBIS Group.
"We have been informed by HBIS that they have not been able to procure the requisite approvals from the Hebei province government, one of the key conditions precedent for the proposed transaction. Both parties have therefore decided not to extend the definitive agreements," the company said in a statement.
"Tata Steel will immediately begin engagement with other investors in continuation of its strategy to find a partner for the business," it added.
This is the second attempt by Tata Steel to sell low-margin assets abroad and resolve its debt. Tata Steel was expected to sell a 70 per cent stake to HBIS for 327 million dollars in cash.
As per the deal, TS Global Holdings Pte Ltd -- an indirect wholly-owned unit of Tata Steel -- had signed definitive agreements in January 2019 with an entity controlled by HBIS to sell its entire stake in NatSteel Holdings Pte Ltd and Tata Steel (Thailand).
Tata Steel Group is among the top global steel companies with an annual crude steel capacity of 33 million tonnes per annum. The group (excluding southeast Asia operations) recorded a consolidated turnover of 22.67 billion dollars in the financial year ending March 31. In 2018, it acquired Bhushan Steel Ltd which has been renamed as Tata Steel BSL Ltd.