Tata Steel is planning to offload less than 50 per cent in Tata Korf. The move comes after the exit of German major Mannesmann Demag from the closely-held engineering company.
The steel major has been in talks with two companies, and was likely to seal the deal with a US-based company, Tata Steel officials said. No official decision on the partner has yet been taken.
Eventually, the Tatas are looking at the option of exiting from the company entirely and could divest the entire stake to the probable partner.
Mannesmann, which held 39.5 per cent, has now completed its exit from Tata Korf. Tata Steel currently holds the entire 100 per cent equity, and hence is looking for a strategic partner.
Confirming the development, R C Nandrajog, vice president -- finance, Tata Steel, said: "We are in the process of finalising a deal. We are in talks with two companies including a US company, with which talks have been positive. We expect the process to be over latest by December."
"We would be offloading less than 50 per cent stake in the first instance and in due course, plan to divest entire holding in Tata Korf," Nandrajog said.
Tata Steel at the moment cannot look at the option of exiting the business considering the pending orders that are to be executed, he said. Currently, the subsidiary has 36 employees.
The Tatas established the joint venture with the German engineering major in 1985 to make it a major player in the iron and steel technology market.
The company, however, has accumulated losses worth Rs 5.69 crore. Its turnover last year doubled to Rs 22.93 crore, while its net profit increased to Rs 22.93 crore.
Tata Korf supplies mini-blast furnace largely to Tata Steel and has a market share of 75 per cent in this category. It has also diversified into coke, energy and environmental consultancy, engineering services and equipment supply. The company has its corporate headquarters in Kolkata.
Tata Korf offers technology, consultancy and engineering services and equipment supply for heat recovery coke ovens, mini-sinter plants, mini-blast furnaces for iron-making, foundry and steel-making applications, energy optimising furnace and other related technologies.
It also offers energy management services including captive power plants and makes air and water pollution control systems including gas cleaning plants.
