As the countdown begins for a decision on Corus, the Tatas could get sucked into a bid battle, paying far too much. CNBC-TV18 shares some interesting details with domain-b.

Once upon a time, in 2003, Corus was a penny stock. Bidders could buy the company for a few million dollars. But now it costs a few billions.

Andrzej Kotas, chief executive of steelonthenet.com says, "Now of course the company is much more expensive, and therefore the opportunity is not quite the same. So there is question mark as to where actually is the upside for somebody like Tata."

The risks are higher because of the bidders'' financing models. Analysts say both bids would use borrowed money for the deal.

Steel expert, Mike Mytton says, "The concern that people would have in terms of Corus''s future as a company would be that if there was a downturn in the steel market. The interest on those loans still has to be paid, and it is paid out of the cash flow of Corus."

Analysts warn of risks like high production costs in Europe, overestimated steel demand and lower projected prices.

Steve Mackrell, director, operations of Iron and Steel Statistics Bureau, says, "There certainly are some concerns about that. Because too much steel on the market will depress prices."

Even so, the bidding battle goes on. And that could be dangerous. Lord Swraj Paul, Chairman of Caparo Group says, "It really has ended up in an auction. The two parties are bidding, somebody will either be told by their banks that no, we are not going to lend you any more money, or somebody will find that he fancies it enough, and he sees the value in it."

There are enough indications to suggest that Tata should steel itself against bidding yet higher for Corus. But players in the global steel industry feel that the Tatas stand a better chance of bagging Corus, as the steel industries in the two countries involved can combine for better synergies.

Wilbur Ross, Board Member, Arcelor Mittal, says, "I believe there will be a very good chance that it (the deal) will be approved. I think there is good industrial logic to the Corus acquisition by Tata and I think it symbolises very much the consolidation of the steel industry that had really started with Lakshmi Mittal some 12 years ago.