There are fears that the Dutch and British arms of Tata Steel are on the verge of breaking apart, according to a report in the Dutch newspaper Volkskrant
According to another Dutch news source (DutchNews.nl) the fact that the British arm of the business has applied for state support to the tune of EUR565 million means that a break-up is inevitable to ensure that British taxpayers' money doesn't end up in the Netherlands, a Dutch News.nl report claims.
It is reported that an independent future for the Dutch and British businesses is under discussion by the management and executive boards and that the reasons behind the potential break-up are threefold and to do with Brexit, the fact that the Indian business is not going to help its 'European parts' any more and, of course, the COVID-19 pandemic. It is being claimed that the British part of the business will go bust without state support, according to comments made by Professor Hans Schenk of the University of Utrecht.
The Volksrant report claims that Tata Steel in the Netherlands is out-performing the British business, although turnover in the Netherlands has dropped 20% because of problems facing the automotive industry. It is argued, however, that the Dutch business is 'well-placed to get through the coronavirus crisis in a reasonable way'.
The corona virus crisis, claims the DutchNews.nl report, has delayed a planned reorganisation of Tata's European arm until July at the earliest.
There had been plans to cut 3,000 jobs (1,000 at IJmuiden) in order to restore profitability, claims the news report.
A spokesperson for Tata Steel’s European operations said: “We recognise the uncertainties caused by this unprecedented pandemic. But we are one company and we believe in the value created for our customers by the combination of our businesses.
“Through our transformation programme, we must continue to look for improvements and efficiencies in our business so we can meet the needs of society and all our stakeholders, both now and in the future.
“Our first priority is to ensure everyone remains healthy and safe in every country we operate in. We must work together on this, especially at this time. We believe we should be focused on making our company strong again, and to achieve that, we must do it together.”
According to Tata Steel's European operations spokesman, the Volksrant article is based on inaccurate speculation and assumptions and we don’t recognise ourselves in the story.