Tata Steel UK rated ''BB-/B'', outlook ''positive''; Corus L-T CCR cut to ''BB-'', outlook ''stable''

11 July 2007

Standard & Poor''s said today that it had assigned its ''BB-'' long-term and ''B'' short-term corporate credit ratings to the UK-based steel producer Tata Steel UK Ltd (TSUK), the new intermediate parent holding company of UK-based steel manufacturer Corus Group PLC and wholly owned subsidiary of Tata Steel Ltd. (BB/Positive/--) India''s second-largest integrated steel producer.

The outlook is positive.

Standard & Poor''s also assigned its ''BB'' senior secured debt rating and a recovery rating of ''2'' to the £3.67-billion senior secured debt issued by TSUK and subsidiaries, indicating our expectation of substantial (70 per cent - 90 per cent) recovery in the event of a payment default.

The issue rating is one notch above the corporate credit rating.

At the same time, the long-term corporate credit rating on Corus Group was lowered to ''BB-'' from ''BB'' and removed from CreditWatch with developing implications. The outlook is stable. The short-term corporate credit rating on Corus Group was affirmed at ''B'' and removed from CreditWatch with positive implications.

Both ratings were initially placed on CreditWatch on Oct. 18, 2006. The lowering of the long-term rating reflects Corus Group''s much higher leverage following the completion of its takeover by Tata Steel.