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British Steel: Takeover set to be completed

March 9, 2020

 

 

A Chinese firm is set to complete its takeover of British Steel on Monday.

Jingye Group previously said that it would save more than 3,000 jobs in Scunthorpe and Teesside and modernise the towns' steelworks.

 

The firm reportedly offered £50m to buy the company after it collapsed and was placed under the control of the UK Insolvency Service last year.

Unions have said that nearly 500 workers could still face losing their jobs.

 

British Steel employed about 5,000 people at the time of its collapse, and is the second-largest steelmaker in the country.

 

Jingye Group, which also makes steel, has also promised to invest about £1.2bn over the next 10 years on upgrading its plants and machinery.

 

Jingye's chief executive has described the deal as a "new chapter in British steelmaking".

 

Uncertainty for workers

 

Confirmation of the takeover will follow months of uncertainty for workers. The government has kept British Steel running since last May as it looked for a buyer for the business.Jingye signed an agreement to purchase British Steel in November after talks between the Official Receiver, which handled the insolvency process, and a Turkish bidder fell apart.

 

In January, the French government said it might veto the deal because it considered British Steel's plant in Hayange a strategic national asset.

Located in north-east France, the plant is seen as important because it supplies track for the country's railways.

 

Jingye's boss said earlier this year that he remained "interested" in purchasing the plant, but has pressed on with purchasing assets in the UK and the Netherlands.

 

British Steel was formed in 2016 after being sold by India's Tata for £1 to the private equity firm Greybull Capital.

It entered insolvency less than three years later. It had sought financial support from the government before it was placed in liquidation.

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