Engineering news
Tata Steel UK has signed a definitive sale agreement to sell its Speciality Steels business to Liberty House Group for £100 million.
The agreement covers several South Yorkshire-based assets including the electric arc steelworks and bar mill at Rotherham, the steel purifying facility in Stocksbridge and a mill in Brinsworth, as well as service centres in Bolton and Wednesbury, UK, and in Suzhou and Xi'an, China. Speciality Steels directly employs about 1,700 people making steels for the aerospace, automotive and the oil & gas industries.
Bimlendra Jha, chief executive of Tata Steel UK, said: “This is good news for Speciality Steels and for Tata Steel’s core business in the UK. For Speciality Steels, which is largely independent of our European strip products supply chain, this is an important step forward in securing a future for the business under new ownership. Today’s news also marks another important step forward in realising a more sustainable future for our Port Talbot-based supply chain in the UK.”
Jha added: “Like our former Scunthorpe-based Long Products business which we sold last year, we will be handing over a business which has been transformed following difficult decisions to restructure and re-focus on higher-value markets. Employees, trade unions and the management team have worked incredibly hard at Speciality Steels to improve its performance and I’m delighted to say that the business is now on an improvement track which will enable it to thrive in the future.”
Completion of the transaction remains subject to regulatory clearances. The companies will also be working to complete consultation with employees and the transfer of supplier and customer contracts.
Sanjeev Gupta, executive chairman of the Liberty House Group added: “I am proud that we are acquiring a world-class business with a very skilled workforce and broad range of high-value products. It is one of only a handful of such operations in the world and I am confident it will flourish within our group. Fulfilling the next key stage of our GREENSTEEL vision is incredibly exciting. We will now be able to melt scrap steel to create high-value-added products and I hope that, in due course, we will do so using renewable power.
“In the very week that Liberty is celebrating its 25th anniversary, I am delighted to welcome many hundreds more members to the Liberty family. We are grateful for the support from all stakeholders in achieving this deal, including the employees, unions and advisers.”
Business secretary Greg Clark said: “Acquiring Tata’s Speciality Steels business in South Yorkshire and West Midlands, which manufactures high quality steel for some of the UK’s world leading industries such as aerospace and automotive is a great opportunity for Liberty House. I look forward to hearing more about their expansion plans which secures skilled jobs at the business into the future.
“We want to work with the steel industry on proposals to transform and upgrade their sector as part of the modern Industrial Strategy so we can build on our strengths and extend excellence into the future.”
The steel unions have greeted the news with caution.
Roy Rickhuss, general secretary of Community, said: “Today’s news is a welcome step forward in securing the future of the Speciality Steels business. However, this is not the end of the process and there is still work to do before the sale is completed. Community has been campaigning for months for longer-term certainty for these highly skilled jobs and we will now engage more directly with Liberty to understand their plan for the business.
“We will need to be convinced this sale is in their best interests. We also need to see the government do more to help support the future of Speciality Steels and create an environment in which the whole UK steel industry can survive and grow.
“We are continuing to ballot our members in Speciality Steels over the future of the British Steel Pension Scheme and proposed alternative pension arrangements, which, should our members vote to accept the proposals, would transfer over as part of their terms and conditions once a sale is completed.”