British Steel Limited

British Steel Limited

Industry	Steel
Founded	2016
Headquarters	England/France
Products	long products
Number of employees	4,000
Parent	Greybull Capital
Website	www.britishsteel.co.uk

British Steel Limited is a long steel products business founded in 2016 with assets acquired from Tata Steel Europe by Greybull Capital. The business' primary steel production site is the Scunthorpe Steelworks, with rolling facilities at Skinningrove (UK), Teesside (UK), and Hayange (France).

History

During the 2010s, a combination of reduced demand for steel in Europe (see Financial crisis of 2007–08 and Great Recession) and high company indebtedness saw the Tata Group began a sales process for the long products division of Tata Steel Europe to the Klesch Group.^[1] In 2014 the long products division employed approximately 6,500 workers and was operating at about 60% of its five million tonne p.a. capacity. The division included primary production at Scunthorpe steelworks, mills in Teesside (Teesside beam mill, Skinningrove and Darlington special profiles), France (Hayange rail mill) and Scotland (Dalzell and Clydebridge), along with other assets including the Immingham Bulk Terminal.^[2] In late 2014 estimates for the value of the property was approximately $1.4 billion.^[3] Talks during August 2015 on the acquisition ended unsuccessfully, with Klesch citing energy prices and (dumping of) Chinese steel imports as factors against the sale.^[4][5] The Scottish facilities were mothballed in late 2015, and then sold to Liberty House Group in 2016.^[6][7]

In late 2015 a prelimary agreement was made with Greybull Capital for the sale of the long products division.^[8] The sale was agreed to on 11 April 2016 for a nominal £1, with Greybull taking over the assets and liabilities of the division. At takeover the division employed approximately 5,000 workers, predominately in the UK.^[9] The sale was completed at the end of May 2016, with the resulting business renamed British Steel.^{[10][note 1]} As part of the takeover, new agreements were made with workers and unions, including a wage cut, end to bonus schemes, and the end of a final salary pension scheme. The British Steel Pension Scheme (BSPS) was not included in the sale. Greybull stated that at acquisition the business was profitable.^[12]

In June 2017, it was reported that the previously loss-making plant at Scunthorpe was once again back in profit, a year after Greybull took the concern over from Tata Steel. The 2015-2016 financial year saw a loss of £79 million, whilst 2016-2017 produced a profit of £47 million before tax. In light of this, British Steel Limited announced that the 3% pay cut agreed to by the workers on takeover, would be reversed.^[13]

Operations

At creation in 2016 the business consisted of

• Scunthorpe Steelworks, England – primary blast furnace based production – bloom, billet, sections, slab, rail and wire rod and is known as the largest steel factory in the U.K.
• Teesside Steelworks, England (Teesside Beam Mill) - heavy sections
• Skinningrove Steelworks, England – special sections and crane rail
• former Sogerail plant, Hayange, France – railway rails
• An engineering workshop in Workington

Notes

References