Tata Steel’s beleaguered Scunthorpe steelworks plant in Lincolnshire is understood to be changing hands next week after it completes the sale of its European long-products division to investment group Greybull Capital for a token £1.
The deal was first announced last month, when Greybull said it was arranging a £400 million investment and financing package for the new business. The deal secures about 4,800 jobs.
According to Sky News, Greybull is formally taking control of the business next week – there is a statement confirming the change of ownership provisionally earmarked for next Wednesday.
UK based Greybull, which describes itself as a “family office that makes long term investments in private companies”, will immediately rename the business ‘British Steel’. The group believes it can make the business profitable within one year if it can restructure deals with major suppliers and come to a union agreement on pension costs.
Paul McBean, chair of the multi-union committee at the soon-to-be renamed plant, was quoted by The Financial Times as saying: “We have put in an awful lot of hours and travelled a lot of miles to get here. It’s fantastic to start a new chapter”.
Nic Dakin, the Labour MP for Scunthorpe, told the FT that it was a “great day for the community after a long and difficult challenge”.
“But there are still things the government can do to support the industry properly,” he added.
The news comes as Tata discusses the sale of the rest of its British operations with prospective buyers.
One of the main obstacles in finding a buyer for the rest of its UK business is the £14bn British Steel Pension Scheme attached to it, which has 130,000 members and a £700m deficit.