Turkish Pension Firm to Buy British Steel
British Steel, the doomed company that has been struggling to overcome its declaration of insolvency, has tentatively been bought by Turkey’s military pension fund.
In a deal announced in August, the Turkish Armed Forces Assistance Fund plans to buy the company out, potentially saving the jobs of around 5,000 people in its central Scunthorpe plant and alternate location on Teeside.
The company was put into compulsory liquidation after talks between Greybull, the company who used to own British Steel, and the UK government broke down, putting another 20,000 jobs along the supply chain at risk.
An official Parliamentary inquiry was also scheduled to investigate how the company – one of the biggest in the steel industry – collapsed so quickly.
The move was welcomed by the trade group UK Steel as a positive move towards ensuring job security for British Steel workers.
British Steel At Risk
Over one-third of the UK’s steel production comes out of British Steel and, in a statement to the BBC, general secretary Gareth Stace noted that if the company were to shut down permanently it would leave the sector’s capability in a ‘considerably poorer state’.
Business Secretary Andrea Leadsom also welcomed the move as a positive step forward to reinstating British Steel as the key player they once were in the steel industry.
However, the response from trade unions has been a little more tentative, with many calling for the TAFAF to confirm the security of employee’s positions and that production will remain in the United Kingdom after the deal has been made.
According to reports from those in charge of facilitating the sale, there were a number of bids for British Steel, but the Turkish AFAF were the preferred choice to take over the company.
This now means they have access to British Steel’s financial records and can assess what actions need to be taken to reverse its insolvency.
The investment company that will oversee this is called Ataer, who have a 50% stake in Turkey’s largest steel manufacturer and make around a quarter of the steel used within the country, making it the third-largest producer in Europe.
Source: BBC News