Rupee opens higher & Tata Steel UK reaches
The Indian rupee opened higher by 7 paise at 67.83 per dollar on Thursday versus previous close of 67.90.
Euro witnessed some strength, helped by reports that Italian government
is preparing to rescue the country’s third largest bank Monte dei
Paschi as hopes for a private aid are fading. It is widely reported that
Government may buy 2bn euros controlling stake in the bank, which has
triggered moderate decline in Italian bond yields. In this regard,
ten-year Italian bond yields fell 8 basis points to hover around 1.9%.
The Reserve Bank of India’s (RBI) reference rate as on December 07,
2016, for the dollar stood at 67.87 while for the Euro it was 85.86. The
RBI’s reference rate for the Yen stood at 59.41; reference rate for the
Great Britain Pound (GBP) stood at 72.75.
Tata Steel UK reached
an agreement with trade unions on a number of proposals that would
structurally reduce risks and help secure a more sustainable future for
its UK business. The company will next week start consultation with its
employees on a proposal to close the British Steel Pension Scheme to
future accrual. Employees would be offered a competitive defined
contribution scheme.
The proposal on pensions and other changes in the employment terms are
part of the ongoing transformation plan that the business is
undertaking. As part of today’s agreement all parties will work towards
making Tata Steel UK a sustainable business.
The company and trade unions have also agreed on the principle that
subject to the structural de-risking and de-linking of the British Steel
Pension Scheme fund from the business, Tata Steel UK will continue the
existing blast furnace configuration in Port Talbot until 2021.
Further, based on achieving the necessary financial performance and
cash flows as per the transformation plan of the UK business, the
company will continue to invest across the UK sites to enhance the
competitive position of Tata Steel UK in the European steel industry.
The company has also offered an employment pact until 2021 which
supports employees through future changes by investing in their skills
to support further plant upgrades, automation and other digital
initiatives.
Koushik Chatterjee, Group Executive Director Tata Steel and Executive Director for its European business
said: “The agreement between Tata Steel UK and the unions today marks
an important step forward in the journey to develop a sustainable future
for our UK steel business. These are unprecedented times for the steel
industry globally with multiple risks including global economic
uncertainty, slow manufacturing growth and currency volatility which
continues to present significant challenges to the business.
“The delivery of Tata Steel UK’s transformation plan and generation of
free cash flows will be the key enabler for the future sustainability of
the business and we are very encouraged by the early signs of the
delivery of the plan. There is much more work to be done to make Tata
Steel UK more financially sustainable, but I am confident that all
stakeholders will do all they can to try to ensure that the company will
be able to achieve its plan in the coming months and years. The
proposed changes to future pension provision and other employment terms
are necessary to de-risk the company and help achieve long-term
sustainability. We are also working separately on a necessary structural
solution for the British Steel Pension Scheme fund. The trade unions
and the company have worked hard to reach today’s agreement and I would
like to thank them for their efforts and seek their continued support in
the future. We look to other stakeholders such as the UK Government to
play their part in addressing the UK’s manufacturing competitiveness
position especially with relation to energy prices.”
He continued: “Tata Steel UK has developed a long-term investment plan
to make the business more competitive in the future. The delivery of the
transformation plan in the next couple of years, combined with a
structural solution for the British Steel Pension Scheme fund, is
essential to provide the affordability and financial self-sufficiency
for future investments and also service its financial obligation to its
stakeholders.”
Tata Steel is the UK’s largest steel manufacturer. It supplies almost
50% of UK carmakers’ steel requirements, including body panels and
chassis, and a range of advanced steels for the UK construction industry
which help to reduce buildings’ energy use.
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