KEY shareholder Tata Steel has an open mind about Rio Tinto's impending takeover of Riversdale Mining.
This, as long as its investment goals are met, according to the Indian giant's vice-chairman, B. Muthuraman.
"We are a strategic investor, and we want coal for our own use, and we want that coal for an economical advantage," Mr Muthuraman said at trade exhibition in Singapore.
"As long as these objectives are met, we'll be happy to talk to anybody."
Tata, the world's seventh-largest steelmaker, has a 24 per cent stake in Riversdale, along with an agreement to buy 40 per cent of the output from Riversdale's Benga coalmines in Mozambique.
The Indian company has so far declined to make a recommendation on Rio's $3.9 billion bid for Riversdale, but Reuters recently reported that Tata would hang on to its stake.
Besides Rio, an Indian consortium of five state-run firms -- but not Tata -- is also considering a bid for Riversdale.
Focus on the impending takeover has intensified as floods have slashed production at Queensland coalmines.
Mr Muthuraman said the floods were likely to drive up global prices of steel and raw materials like coking coal.
"The Australian floods are a cause for worry," Mr Muthuraman said.
Australia, the world's largest coal exporter, supplies two-thirds of the hard coking coal traded in the global seaborne market.
Mr Muthuraman said Tata Steel was unlikely to be adversely affected as part of the coal used by the company came from its mines in India.
"The shortfall from Australia will be met by increasing our production in India," he said. "I also don't expect our European operations to be affected much, because we have built up stocks there."
Tata Steel acquired British steelmaker Corus in 2007 to become the seventh-largest steelmaker in the world.
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