TRF Shares Surges 20%, After it Cancels Amalgamation with Tata Steel

TRF, a Tata Group company involved in manufacturing of engineering equipment and systems, cancels merger plans with Tata Steel. After the news hits the market, the share price of TRF surges 20% on the Wednesday, February 7, 2024 trading session.

Since the initial announcement of Merger in September 2022, Tata Steel has provided significant operational and financial support to TRF. It led to a positive turnaround in its business performance despite a challenging environment.

What TRF Said in Exchange Filing?

In the exchange filing on Wednesday, February 7, 2024, TRF said it has decided to not proceed with the scheme of Amalgamation with Tata Steel because in the last few quarters, the business performance witnessed a significant improvement.

TRF also attempted to enhance debtor collection along with attempting cost and asset allocation. It also highlighted support from Tata Steel in the form of placement of orders and infusion of capital.

In response to this, the board of Tata Steel has also consented to withdrawal of the scheme. An application to withdraw the proposed scheme has been filled with the Kolkata bench of the NCLT who has convened a meeting of Company’s shareholders on February 8, to consider the above scheme to be infructuous. Promoters hold a 34.6% stake in TRF based on December quarter 2023 share holding pattern.

Tata Steel and Other Companies Amalgamation Update 

Tata Steel has completed the amalgamation process for five businesses, the merged entities are Tata Steel Mining, Tata Steel Long Products, The Tinplate company of India, Tata Metaliks.

The merger processes for three other companies: Bhubaneswar Power, Angul Energy, and The Indian Steel and Wire Products are in advanced stages with the respective jurisdictional company law tribunals, as per the filing. These processes are expected to conclude by Q1 FY25.

TRF share price on Wednesday, closed at Rs 327.70 with a rise of 19.99%. While, the share price of Tata Steel closed at Rs 144.40 with a minor decline of 0.17%.