Mumbai, July 5: Indian Oil Tanking Limited (IOTL) will buy the 54.9 per cent stake held by Tisco and its subsidiaries in Stewarts & Lloyds of India (S&L).

The deal will see the Indian Oil subsidiary snap up shares at Rs 25 per share from Tisco and its two arms — Kalimati Investment Company and Tata Refractories.

Stewarts & Lloyds is a Calcutta-based pipe construction company with revenues of Rs 54 crore in 2003-04. “The sale by Tisco was part of its ongoing exercise on portfolio restructuring,” a company release said.

Indian Oil Tanking is a 50:50 venture between Indian Oil Corporation Limited and Oiltanking GMBH of Germany. The firm provides independent and dedicated services from its own terminals, besides operating and maintaining those of third parties.

IOTL also designs and helps construct petroleum and chemical terminals, refinery and power plant offsite facilities, cross-country pipelines and marine facilities.

The stake sale will give Tata Steel, the country’s largest private-sector steel company, the cash it needs to hike capacity by 2.4 million tonnes. The bulk of the Rs 7800-crore estimated cost would come from internal accruals and long-term loans, the company said.

The massive expansion will be completed by 2009, and would take the steel giant’s capacity to 7.4 million tonnes. The plan means that Tata Steel would add almost half its current production capacity.

This is in addition to the one million-tonne expansion that is currently under way at the steel major’s Jamshedpur plant. The project will be completed by September 2005, and will push up its capacity from four million tonnes to five million tonnes.