Tata Steel Limited, an Indian multinational steel-making company headquartered in Mumbai, has completed the sale of its long products business to investment firm, Greybull Capital, in a £400 million-deal that will help preserve more than 4,000 jobs in the UK and also revive the name of British Steel.
The sale includes a steelworks in Scunthorpe, two mills in Teesside, an engineering workshop in Workington, a design consultancy in York, and associated distribution facilities, as well as a rail mill in northern France.
“As a responsible seller, Tata Steel is delighted to have secured a buyer for this business and we hope that under Greybull Capital ownership, the business will continue the momentum of the improvement program that has been initiated in the last 12 months,” Bimlendra Jha, executive chairman of the Long Products Europe business and chief executive of Tata Steel UK, said.
“Employees and trade unions have worked closely with the Long Products Europe management team to improve the business’s prospects, putting it in a more competitive position that it has been for many years. It is through their dedication and hard work that we are in this position today in spite of continued challenges in the market,” the chief executive further explained.
Now, the company’s 4, 800 steelworkers—4,400 in the UK and 400 in France— will retain their jobs under new management when the deal is finalized.
Employees received a temporary three per cent pay cut and changes to terms and conditions two months ago as part of a deal to restore the business, which will now trade under the name British Steel. The brand of the previously state-owned business disappeared in 1999 upon the establishment of Corus, which was bought by the Indian conglomerate in 2007.
In December 2015, Tata began talks with the investment firm about the sale, three months prior to the Indian multinational company deciding to sell its entire business in the UK. The UK government has also offered to provide £100 million worth of loans and guarantees to the buyers. However, the deal was completed with a financing package coming from private sector institutions only.
Announcing the completion of the deal, the steel-making company did not mention its attempt to sell its remaining UK steel assets, which employ about 11,000 workers and include the blast furnaces at Port Talbot in South Wales.
A Tata spokesman said: “Today is all about the completion of the sale of the Long Products Europe business. When it comes to the rest of Tata Steel UK’s assets we can only say that the process to explore all possible options continues.”