Tata Steel UK is to sell its Long Products Europe business – including the Scunthorpe steelworks – to Greybull Capital for a nominal fee.
The sale includes two mills in Teesside, an engineering workshop in Workington, a design consultancy in York, and associated distribution facilities, plus a mill in northern France.
Hans Fischer, chief executive of Tata Steel’s European operations, said: “Under these current challenging market conditions in Europe with the soaring levels of imports from China, we are happy that Tata Steel UK and Greybull Capital have entered the final stage of completion of the sale of shareholding in Longs Steel UK.
“This transaction will offer a future for the Long Products Europe business and its 4,400 employees in the UK.”
According to Tata Steel UK, the deal will conclude once a number of outstanding conditions have been resolved, including transfer of contracts, certain government approvals and the satisfactory completion of financing arrangements.
The Long Products Europe business employs 4,800 people, with 4,400 in the UK and 400 in France.
Gareth Stace, director of UK Steel, said: “This is clearly good news for the British steel sector, and I hope it will provide a much needed boost for steelmaking in the UK.
“A long term investor is needed, in the very short term, for the remainder of the whole of the Tata Steel UK business, including Port Talbot. We must also remember that the crisis that we are in is not confined to just the Tata Steel businesses, but the sector as a whole.
“In order to help make the Long Products Europe business a success, as well as the steel companies across the UK, we still need government to…take every action possible to ensure British steel can once again complete on the global market place.
“This includes pushing the European Commission to continue its steel dumping investigations ensuring that tariffs are set at an appropriate level.”
Presumably the PPE and Eton educated ‘toffs’ who presently ‘run’ our nation to their own advantage and that of those who pay them to do so (more PR puffers and manipulators) are close to realising just how far from reality they have wandered. i am reminded of the stance that the Norwegian Government took in the 80s. The local garment manufacturing industry had been so decimated by imports (and the greed of retailers) that there was no-one left to make clothing as basic as that needed by the Norwegian Army. Having outstanding weapons for defence are of little use if the military are naked! Clothing manufacture became a strategic matter. I have to presume that having steel (of all types) available to supply our armed forces if needed in a crisis would certainly be just as strategic. Indeed more so. Do I not recall that the poor dyestuffs available from local manufacturers (as opposed to those which had been imported from the Kaiser’s Germany pre- 1914 caused the UK uniforms to turn bright orange!
I am aware from personal experience, that the ITT Rayoner factory in N Carolina (the start fibres for ablative structures and venturi rocket nozzles) was maintained in production at a loss, because its strategic importance was recognised for decades. But what can we exp[ect from the associates of the grocer’s daughter: who like all retailers believe that suppliers are there to be set against each other and sc**wed until they fail. Placing impossible terms on a supplier is inviting him to let you down! And he will.
Value added or simply profit added. Perhaps the ultimate ‘test’ of any commercial activity. I have heard much talk following the ‘off-shore’ shinanigans of ‘investors’ having to be encouraged to invest. PPE trained toffs believe investing involves buying and selling ‘paper’ to each other-so that their portfolios are stuffed with such? Our Victorian Ancestors knew that investing involved encouraging shareholders to buy the initial ‘shares’, the purchase of land, the building of manufacturing facilities, the purchase and operation of machinery, the employment of labour, its training, motivation, and proper reward (they did sometimes fall down a bit on this), the operation at a profit, sensibly split between owners and other stakeholders….and so on.
Our apparent leaders (and betters) seem to wish to skip all of the above and take the lions share at the end! Your world, and welcome to it?
Derivative trading, property values and interest rates are symptoms of what Mike describes. Sadly, innovation and investment in new processes and plants is high risk and needs to have high returns.
Unfortunately, only white elephants like windmills and solar power have been given subsidy status and these are already costing the UK economy dearly. I agree with Mike that our political leadership is following the asset-stripping philosophy of their great guru and believes that quick profits now are more important than long term investment.