Some 3,200 jobs have been safeguarded after Chinese steel giant, Jingye Group, completed its acquisition of Scunthorpe-headquartered British Steel in a move described by CEO Ron Deelan as a “momentous day.”
The completion follows the agreement of new terms with customers and suppliers, saving thousands of jobs. However, around 400 employees have not received offers of employment and will be let go.
The sale includes the steelworks at Scunthorpe, the UK mills in Teeside and Skinningrove, shares of FN Steel BV, and the TSP Engineering business based in Cumbria.
Ongoing discussions aim to resolve the regulatory approvals needed to sell British Steel’s French subsidiary based in Hayange to Jingye.
With the deal completed, Jingye will invest £1.2 billion to make the business more competitive and boost energy efficiency and environmental footprint.
This will include the construction of a 250 MW power plant to serve the Scunthorpe site. The new plant is expected to be around a third more efficient.
“It has not been an easy journey since we first announced our intentions in November but the longer I have spent in Scunthorpe, the more I have come to believe in the successful future of these steelworks and the employees that have made them famous throughout the world,” said Jingye Group CEO, Li Huiming.
“Together, we can forge a new partnership that will mark the beginning of a new illustrious chapter in the history of British steelmaking.”
Business Secretary, Alok Sharma, said: “The sale of British Steel represents an important vote of confidence in the UK’s steel industry. It also marks the start of a new era for those regions that have built their livelihoods around industrial steel production.”