Indian steel producer Tata Steel has reportedly plans to acquire British steel giant Stemcor's iron ore mine in Orissa - a state situated on the east coast of the country.

Stemcor has defaulted on more than $1 billion of loans as global slowdown in the steel industry has hit its business hard. The British firm is thus trying to sell some of its assets to get rid of some burden of its loans.

The reported sale of its iron ore mine in Orissa is expected to fetch it nearly $800 million.

On the other hand, Tata Steel is looking to acquire iron ore assets to ensure undisrupted supply of iron ore to its steel plants in India.

Iron ore is the main ingredient for producing steel. China is the world's biggest buyer of the metal, while India is a main supplier of spot cargoes to the world's most populous country.

Last week, the British firm tabled a recovery plan proposing shrinking of the business by offloading some assets. The move would cut its revenues by an estimated 30 per cent.

Lenders have granted Stemcor a payment holiday of up to September 16 on its unpaid debt. The British steel firm has also been asked to submit a full debt restructuring plan with lenders by the end of August this year.