Tata Steel Reveals $1.6 Billion Writedown

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India’s Tata Steel has announced a $1.6bn writedown on its struggling European division, underlining the chronic difficulties facing steelmakers across the continent, the Financial Times reported. In a notice to the Bombay Stock Exchange, the steel division of the broader Tata conglomerate blamed weak European macroeconomic conditions for the decision, the largest writedown by an Indian company. Tata Steel’s European operations, which it acquired following the $13.1bn purchase of Anglo-Dutch steelmaker Corus in 2008, have endured a torrid period recently in the face of weak demand and falling prices. The announcement raised fears in particular over the future of the group’s troubled UK operations, where 18,500 of its 33,000 European staff work. In the notice, Tata Steel said: “The impairment is primarily due to a weaker macroeconomic and market environment in Europe where apparent steel demand has fallen significantly in 2012-13 by almost 8 per cent, which in aggregate results is almost 30 per cent since the emergence of the global financial crisis in 2007.” The writedown is the largest for a company with Indian operations since Vodafone of the UK took a £2.3bn impairment charge on its unit in the country in 2010. Read more. (Subscription required.)