Tata Steel UK to sell steel business to Liberty House for 100 million pounds
Tata Steel UK on Monday announced the signing of a ‘letter of intent’ with Liberty House Group for the potential sale of its Speciality steel business for an enterprise value of 100 million pounds.
“The letter of intent covers several South Yorkshire-based assets including the Rotherham electric arc, steelworks, the steel purifying facility in Stocksbridge and a mill in Brinsworth as well as service centres in Bolton and Wednesbury, UK and in Suzho and X’ian, China. Speciality Steel employs about 1,700 people making steels for the aerospace, automotive and the oil and gas industries,” the company said in a filing.
Tata Steel UK has invested 1.5 billion pounds of capital over the last nine years. The company said that its boards have considered the technical feasibility and economic return of investment when taking decisions as well as their affordability.
“The Speciality Steel business is independent of the pan-European strip products supply chain and today’s announcement is in line with the overall restructuring strategy of the UK portfolio. This is an important step forward in seeking a future for Speciality Steels and we have reached this stage thanks to the efforts of employees, trade unions and management. We now look forward to working with Liberty on the due diligence and other work streams so that the sale can be successfully concluded. We will continue to work closely with trade unions and will communicate any material news on this issue to the employees on an ongoing basis,” Bimlendra Jha, CEO Tata Steel UK said.
The company said it is pursuing a transformation plan to create a sustainable future for its UK strip products business and the success of this plan was likely to influence decisions on future investments.
Shares of the Tata Steel marginally dropped 0.15% to Rs 407.1 after this announcement on BSE Sensex.