Tata Steel is looking to acquire Brazilian iron ore assets of London Mining

Tata Steel, the world's sixth-largest steel maker, is looking to acquire Brazilian iron ore assets of the UK-based London Mining (LM), which will help ensure raw material supply for its Anglo-Dutch subsidiary, Corus. The valuation of the asset is yet to be completed, but it could be in the range of $2 billion. Tata Steel is among various global steel and mining majors that have shown interest in acquiring the assets after London Mining said it was reconsidering its investments in Brazil last month.

London Mining currently owns assets in Sierra Leone, Saudi Arabia, Greenland and Mexico. Raw materials for Tata Steel's plants in India are sourced from captive mines. Corus, which produces 20 million tonnes of steel a year, is facing raw material shortage. The company's iron ore security stands at just 15 per cent. Tata Group Chairman Ratan Tata had earlier said that the Indian conglomerate plans to invest about $15 billion in Brazil through various group companies.

The Indian conglomerate is interested in Brazil because it has one of the world's largest reserves of minerals and iron ore. According to the US Geological Survey, Brazil has produced 300 million tonnes of iron ore last year, which stands second to China's 520 million tonnes. Further Brazil gives geographical advantage to ship the raw materials to Corus units at relatively lower costs.