In a company’s valuation, Price Earning(P/E) multiples are applied to earnings based on the maintainable profits before tax less minority interest(gross). In determining the PE multiples, it is equally important to ensure that the following factors should also be taken into consideration:-

net tangible asset value;
quality of management;
nature of products/services;
track record;
growth prospects;
prospective dividend yield;
prospective tax expense […]

Further to the earlier article on this takeover by Tata, reported in the BusinessWeek.com (20/7/07) regarding the hefty price that Tata paid.

the price was 608 pence per share, which translates to a total purchase price of $12 billion.
which is approximately 9X EBITDA (earning before interest, taxes, depreciation, and amortization)

Some pros and cons has been advocated:
Cons:

Tata […]

Recently reported in Businessweek -
Tata Steel bagged Anglo-Dutch steelmaker Corus Group (CGA) in a $13.7 billion deal, which draws to a close a protracted bidding war with Brazilian rival Companhia Siderurgica Nacional (SID), or CSN.
 
Some interesting facts:

This is the first big step that the Indian industry has taken in the international marketplace and equipped itself […]

SIDC, the training and education arm of the Securities Commission imparted some good information to the public pertaining to M & A ( The Star (29/1/2007)):

definition of mergers  & acquisitions and
the process and
shareholders’ roles in such situations. 

On DEFINITON mergers and acquisitions:-

as M&A is part and parcel of the business world, an investor to know what […]

Recently reported in the Star (12/06), there is a smallish acquisition by public listed company, London Biscuits (confectioner) of acquiring a 20% stake in poultry player Lay Hong  for Rm4.8m or #Rm1.07 per share.
This case is worth noting as London Biscuits is not interested in merely signing a long term supply contract with its supplier, […]