British Steel to Sign Major Rescue Deal with Chinese Industrial Group

SEATTLE (Scrap Monster): The Chinese industrial giant, the Jingye Group, has emerged as the frontrunner in buying the troubled assets of British Steel. The 70 million euro buyout bid is likely to safeguard up to 4,000 jobs. As per media reports, the Chinese Group has agreed in principle to go ahead with the buyout deal.

The company is expected to sign an agreement with British Steel at the earliest. The contracts have been exchanged between British Steel and Jingye, although it doesn’t mean that the sale is fully complete, unofficial reports said. It must be noted that Li Ganpo, Chairman, Jingye Group had recently visited British Steel sites.

The rescue deal is believed to secure nearly 4,000 jobs at the Scunthorpe and Teesside sites, in addition to around 20,000 supply chain jobs. It will also cover additional 1,000 jobs in France and the Netherlands facilities. As per reports, Jingye plans to make significant investment to upgrade major facilities, so as to boost the steel output from Scunthorpe. The British government is expected to offer financial support to the deal in various forms including loan guarantees.

The UK-based Liberty House Group is in the second place in the bidding, with Atear Holdings- the Turkish firm and a subsidiary of the Turkish military pension fund in third place. The Jingye Group came into the picture only after talks between British Steel and the Turkish buyer stalled.