Oct. 23, 2006 — Tata Steel’s board of directors approved the acquisition of the entire issued share capital of Corus Group plc at its meeting held on October 20, 2006. The acquisition is to be accomplished at a price of 455 pence in cash for each share, which values Corus at GBP 4.3 billion.

The acquisition is proposed to be made by Tata Steel UK, a wholly owned indirect subsidiary of Tata Steel, recently incorporated in the United Kingdom for the purpose of completing the acquisition. The said acquisition is proposed to be achieved by means of a scheme of arrangement under Section 425 of the (English) Companies Act 1985, subject to High Court of Justice in England and Wales and the approval of Corus' shareholders.

The acquisition is proposed to be funded through Tata’s own cash resources in addition to loans raised by Tata Steel and its subsidiary companies formed for the purpose of this acquisition.

Tata Steel noted that its acquisition of Corus is consistent with the company’s stated objective of growth and globalization. Growth at Tata Steel has been focused towards new, higher end-markets and a more sophisticated customer base. Tata Steel has identified a number of specific benefits that it sees from a combination with Corus. Enhanced scale will position the combined group as the fifth-largest steel company in the world by production, with a meaningful presence in both Europe and Asia.

Tata Steel says that the combination of low-cost upstream production in India with the high-end downstream processing facilities of Corus will significantly improve the competitiveness of the Corus European operations. The combination will also allow cross-fertilization of research and development capabilities in the automotive, packaging and construction sectors. The acquisition would also foster the transfer, from Europe to India, of technology, best practices and the expertise of senior Corus management. In addition, Tata Steel will retain access to low-cost raw materials and slab for the enlarged group, and exposure to high growth in emerging markets, while gaining price stability in developed markets. Tata Steel said it also believes that between the two companies there exists a high degree of cultural compatibility that would facilitate an effective integration of the businesses over time.

Tata Steel expects to lead the enlarged group with a combined management team. Manufacturing will be organized so as to produce slabs / primary steel in low-cost facilities and produce high-end products in close proximity to the client base in both Europe and India.

Tata Steel notes that its announcement is not intended to and does not constitute, or form part of, any offer or invitation to purchase any securities or the solicitation of any vote or approval in any jurisdiction.

Corus, Europe's second-largest steel producer, had 2005 revenues of GBP 9.2 billion and 2005 crude steel production of 18.2 million tons primarily in the UK and Netherlands. Corus is primarily engaged in the manufacture of semi-finished and finished carbon steel products. Its activities are divided into three main divisions: strip products (including coated and uncoated strip and welded tubes, sold both as coil and sheet), long products (including sections, plates, wire rod, narrow strip and engineering steels) and the distribution and building systems division, which operates as a link between Corus's manufacturing operation and its customers. It has a global network of sales offices and service centers.