Tata Steel to set up unit for medical material, to buy bio-ceramics startup

The firm's wholly-owned subsidiary, Tata Steel Advanced Materials, will pick up 90% stake in Advanced Ceramics

Tata Steel is looking to set up a 'world class' facility to produce medical material and as a step towards it, Tata Steel Advanced Materials (TSAML), an indirect wholly-owned subsidiary, has invested in a bio-ceramics startup, Ceramat Private Limited.

In a filing with the stock exchanges, the company informed late on Monday that TSAML has executed a Share Purchase cum Shareholders’ Agreement for acquisition of a 90 per cent equity stake in Ceramat Private Limited (CPL).

As part of the rationale for the acquisition, Tata Steel said that it had identified Advanced Ceramics as one of the new materials for strategic growth. Within Advanced Ceramics, the first sector of choice is in medical materials owing to high growth potential and non-cyclical nature, the filing said.

It also said that Tata Steel aspires to set up a world class facility to produce medical materials and use CPL as a special purpose vehicle for this purpose. The total cost of acquisition is Rs 90,000.

“The facility shall focus on producing Hydroxyapatite, a calcium phosphate-based ceramic used as bone replacement. The promoters of CPL are among the very few with such proven capability,” the filing further mentioned.

It may be mentioned that at its analyst day presentation, Tata Steel had said that it would be investing in new growth engines which included new materials to counter cyclicality of the steel business.