Tata Steel may not have accepted Rio Tinto’s ongoing offer for Riversdale Mining shares as yet, but it has signed a licensing agreement with the global miner to support technological and commercial development of the environmentally friendly direct iron smelting process called HIsarna.
The agreement was signed last week by Debashish Bhattacharjee, group director, Tata Steel Research, Development & Technology and Sam Walsh, chief executive, Rio Tinto.
It was announced today.
The agreement covers how both parties will work together, sharing their existing knowledge of the two technologies that are combined in the new process. It also covers how benefits from future successful marketing of technology will be made available to both parties, as well as to the members of ULCOS, a consortium of European steelmakers in whose name the project was being carried out.
Funded jointly by ULCOS, the European Commission and the Dutch ministry of economic affairs, a HIsarna pilot plant is being commissioned at Tata Steel’s Ijmuiden steelworks in the Netherlands. The 60,000-tonne plant was intended to allow the two constituent technologies to be tested in combination.
Karl-Ulrich Kohler, managing director and chief executive officer of Tata Steel Europe, said in a statement, “Commissioning of the HIsarna pilot plant represents a potentially key step towards a compact and low-cost iron making process with a significantly reduced environmental impact. The plant demonstrates one of the first and most promising ways in which the European steel industry is developing breakthrough technologies in response to the challenge of climate change.”
Tata Steel’s announcement of the agreement with Rio Tinto today happens to coincide with another from the miner regarding its open offer for Riversdale Mining, where Tata Steel is a significant shareholder.
In an announcement to the stock exchanges, Rio Tinto said it had received acceptances to its takeover offer for Riversdale Mining from CSN Europe Lda (CSN) for its entire 19.35 shareholding, taking its interest in the company to 72 per cent.
The statement, however, did not mention whether Tata Steel would follow suit, but said the offer period was being extended till April 29.
Tata Steel and CSN together held 47 per cent in Riversdale Mining. Rio Tinto became a controlling shareholder in Riversdale earlier this month. Apart from a stake in the holding company, Tata Steel also has tenement stake and watertight offtake agreements.