Rescue of British Steel by China's Jingye confirmed

Andrew Cummings
November 11, 2019

The company employs 4,000 people at its Scunthorpe and Teesside sites, and supports another 20,000 jobs in the supply chain.

British Steel is to be rescued by Chinese company Jingye following several weeks of discussions with a number of interested parties.

Reports said Jingye would pay about £70 million (US$90 million) for British Steel, which collapsed into liquidation in May.

A spokeswoman for Hebei-based Jingye Group said she was unclear about the value of the deal and unsure whether further details would be announced this week.

Gareth Stace, director-general of lobby group UK Steel, told the BBC Radio 4's Today programme that the purchase would "complement" Jingye's production and that it was a welcome investment from the Chinese group.

The group is reportedly planning to increase production at British Steel's Scunthorpe plant to more than three million tonnes per year from 2.5 million.

British Steel had been in rescue talks with Ataer, which is a subsidiary of Turkey's state military retirement scheme Oyak.

If it goes ahead, the deal would end months of uncertainty about British Steel's Scunthorpe plant.

The news comes after negotiations between the British steelmaker failed with Turkish military pension fund Ataer, forcing the United Kingdom company to seek further assistance after falling into administration in May. This came after swathes of cheap steel imports entered the European market from Asia and forced European operators to slash prices, which has had a knock-on effect on the United Kingdom steel industry.

Jingye Group specialises in iron and steel with additional operations in the tourism, hotel and property sectors.

It prompted US President Donald Trump to impose a 25% trade tariff on steel imports from China and the European Union among others.

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