Tata Steel to Invest $2.5 Bn in Singapore Unit to Strengthen European Biz

Tata Steel will invest $2.5 billion (Rs 21,411 crore) in its Singapore unit, T Steel Holdings, to strengthen its European business operations and pay off debt. Tata Steel owns the businesses in the United Kingdom and the Netherlands through T Steel Holdings.

Any overseas investment exceeding $1 billion in a fiscal year requires prior RBI approval. The board approved the investment proposal on Monday. T Steel Holdings is 100% owned by Tata Steel, so the Singapore company's shareholding will remain unchanged following the capital infusion. This move comes after Tata Steel converted $565 million (Rs 4,822 crore) in loans to equity in fiscal year 25.

The Indian company's units in the United Kingdom and the Netherlands are undergoing a transformation as a result of regulatory changes driving decarbonization in Europe. This entails discontinuing legacy assets and replacing them with new production routes centered on electric arc furnaces.

Future cash flows will be determined by the impact of evolving carbon border adjustment regulations (CBA is Europe and the United Kingdom's method of establishing a fair price for carbon emissions while producing carbon-intensive goods). It charges this price when goods are imported into its territory, ensuring a level playing field for local producers facing comparable carbon costs), availability/pricing of clean raw materials, and assumptions about green steel costs and market premiums, according to the Indian company.