Tata Steel UK has signed a Letter of Intent with Greybull Capital with a view to entering in to exclusive negotiations for the potential sale of its Long Products Europe business.
The letter covers several UK-based assets including Tata Steel UK’s Scunthorpe steelworks, mills in Teesside and northern France, an engineering workshop in Workington, a design consultancy in York, and associated distribution facilities. It also includes Tata Steel’s Scottish mills in Dalzell and Clydebridge that Tata Steel UK claims are currently being mothballed.
“This is an extremely critical time for the whole industry, and we have been working hard to explore all options that could provide a future for the Long Products Europe business,” said Karl Koehler, chief executive of Tata Steel’s European Operations.
“We will now move into detailed negotiations with Greybull Capital. It is too early to give any certainty about the potential outcome of these discussions,” Koehler said, adding that Tata Steel will continue to work closely with trade unions and works councils and communicate news to employees on an ongoing basis.
“In the meantime, Tata Steel and our Long Products Europe business will continue to work closely with customers to deliver high-quality products,” he said.
According to Koehler, Tata Steel has been a ‘hugely supportive’ investor in the UK steel market, having invested almost £1.5 billion in its operations. The company’s aim, he said, is to make its European business globally competitive.
Speaking of Tata’s negotiations with Greybull, Bimlendra Jha, executive chairman of the Long Products Europe business, said that much work remains to be done to reach a successful outcome.
• About 4,700 people are employed at Tata’s Long Products Europe business employs around 4,700 people. Tata Steel Europe employs roughly 30,000 people across Europe, including about 17,000 in the UK.