wishdom schreef:
Tuesday, 10th October 2006 18:03
UK govt says it has 'no problems of principle' with Tata/Corus deal
LONDON (AFX) - The UK government has said it has 'no problems of principle' to Indian takeovers of UK business, as speculation mounted about a bid for steel firm Corus Group PLC by Tata Steel.
The chief executive of the government body UK Trade and Investment, Andrew Cahn, today told AFX that the UK would continue its 'hands-off' approach to business, appearing to rule out the threat of Tony Blair blocking any potential bid.
Cahn said that the Corus/Tata deal was not part of the agenda at today's India-UK investment summit in London attended by Indian Premier Manmohan Singh and Blair, but stressed the government wanted to remove as many barriers as possible to investment both in and out of the UK.
'The British government has no problems of principle to large-scale Indian investment in this country and Indian businesses taking over British businesses,' said Cahn. 'That's a generic statement- it doesn't mean this particular deal will go through. But it's a good example of the sort of increased two-way investment which we think is very beneficial.'
'In Britain we have a hands-off approach,' he continued. 'It's not a matter for the government but the companies concerned.'
The Sunday Telegraph reported at the weekend that Tata was considering a 5 bln stg bid for Corus, and had lined up a 3.5 bln package to finance the deal.
India is now the third largest provider of Foreign Direct Investment (FDI) in the UK, compared to being the 11th only three years ago. Today's conference was a forum for senior Indian and UK business figures to mix and to try to improve the volume of UK/Indian trade, and saw both Singh and Blair give addresses as well as both countries' trade ministers, Alistair Darling and Kamal Nath.
Cahn said he was keen to see barriers to overseas investment broken down, including making it easier for UK retailers to operate in India. This is currently problematic because Indian trade laws currently favour small, family run enterprises that make up the bulk of the Indian retail sector.
'Our retailers, who are some of the best in the world, would like to move into India but are prevented by local laws which in particular say that multi-brand retailers can't establish themselves,' said Cahn. 'We would believe that's self defeating for India, as it means they don't get the efficient, cost effective retailing they could, and means the sectors where we have a lot to offer don't get a chance to invest.'
As well as retail, UK officials are particularly keen to open up the financial, legal and energy sectors in India to increased foreign activity.
Tata Sons Ltd, the holding company of Tata Steel Ltd, said today its chairman Ratan Tata had not sought a meeting with Blair, nor was he part of Manmohan Singh's delegation to the UK.