'Tata Steel's takeover augurs well for RINL'

The remarks made by Tata Steel CEO TV Narendran expressing willingness to submit bid for taking over Rashtriya Ispat Nigam Limited (RINL), the corporate entity of Visakhapatnam Steel Plant (VSP), has evoked a mixed reaction.

RINL, which has a debt liability of over Rs22,000 crore following phase-wise expansion from 3million tonnes (MT) to 7.3MT, clocked a turnover of Rs18,000 crore during 2020-21 and it was second highest since its inception.

While the unions said the chance of acquisition by Tata Steel doesn't arise as they are strongly opposed to the decision to privatise RINL, the top executives of the Vizag headquartered company, serving and those who have retired, welcomed the move.

"It will be in safe hands if RINL is bought by Tata Steel, which takes care of the employees like the public-sector units. It will also help the private sector giant to have a foothold in the South and enable it easy access to South East Asia markets," Y Siva Sagar Rao, former Chairman-cum-Managing Director of RINL, told Bizz Buzz on Thursday.

He said during his tenure as CMD, he had mooted expansion of Visakhapatnam Steel Plant to 16 million tonnes by 2020. If Tata Steel acquires RINL, just by investing Rs.5,000 crore or so, the 7.3 million tonnes plant can be put back on the right track. He said proper decision-making, VSP could achieve a capacity augmentation up to 20 million tonnes contributing significantly to India's target to attain a production capacity of 300 million tonnes by 2030-31.

Seeking anonymity, a senior executive of RINL said: "If privatisation is inevitable then Tata Steel will be the best option as the company has mastered steelmaking even before Independence. It is also good at taking care of the employees and development of peripheral areas and the communities in the vicinity as part of its CSR."

PVN Madhav, senior BJP leader and MLC, said disinvestment of PSUs was a policy decision to infuse funds into the capacity augmentation/modernisation of steel units.

He chided the Opposition mainly the Left-affiliated unions for spreading falsehood regarding Centre's stand on offloading equity in the PSUs in favour of private investors. He said if a reputed company like Tata Steel emerges successful in the bidding process, it will be very happy news for everyone.

Madhav said there is no truth in claims that Adani and POSCO have been promised ownership of RINL by the NDA Government.

Visakha Ukku Parirakshana Porata Samiti chairman Ch Narsinga Rao said the statement by a top executive of Tata Steel on its interest to submit bids even before the finalisation of transaction and legal advisors for privatisation of RINL is part of a 'diversionary tactics' at the behest of the Narendra Modi Government.

All India Steel Workers' Federation general secretary D Adinarayana said they are opposed to privatisation by anyone including Tata Steel or POSCO. "Even Adani Group has evinced interest to submit bids as it is eyeing at 22,000 acres owned by RINL to use to expand storage and other facilities of Gangavaram Port," he said adding Tata Steel had shelved plans to set up a 10 million tonne plant at Gopalpur in Odisha and a car factory at Singur in West Bengal after land acquisition due stiff opposition by locals.