Management buyout of Port Talbot steelworks mooted

Tata Steel’s Port Talbot chief Stuart Wilkie to push survival plan for plant previously rejected by the Tata Board in India

A possible management buyout of Tata Steel’s operations in the UK led by Port Talbot steelworks Stuart Wilkie, managing director of Tata Strip Products UK, is expected to be confirmed today.

Reports have emerged that senior figures at Port Talbot steelworks have been briefed about the survival plan, which was previously rejected by the Tata Board in India.

It is understood that Wilkie is leading the push forward with the buyout plan, which is looking for private investors as well as government backing. The bid would require an investment of £100 million, and employees could be asked to invest up to £10,000 each.

Tata Steel directly employs 15,000 people in the UK. Steel company Liberty House, owned by Sanjeev Gupta, has also publicly expressed an interest in buying the Port Talbot steelworks.  

In a statement Tata Steel Europe reiterated its own process to seek strategic alternatives for Tata Steel's UK operations, which has already resulted in advisers beginning  to explore initial interest with 190 potential financial and industrial investors worldwide. 

Tata Steel Europe said: "Tata Steel Europe welcomes credible expressions of interest for Tata Steel’s UK operations. It is our policy that we are not naming, confirming or commenting on any potentially interested investor or bidder at this point. 

"All expressions of interest, including any Management Buy Out proposals, will be considered when received. In the interests of all stakeholders every credible expressions of interest will enter the same rigorous assessment process to ensure the best value and prospects of sustainability."

Tata Steel Europe appointed Bimlendra Jha as chief executive of Tata Steel UK earlier this week as it explores strategic alternatives for its operations in the UK.

The company has also appointed Standard Chartered bank as an additional adviser to reach potential buyers, especially to Asia and the Far East.  They will work alongside KPMG, whose appointment was announced on 11 April.