Chinese steelmaker, Jingye Group, has completed the acquisition of British Steel’s UK and Netherlands assets from the Official Receiver, with an investment commitment of £1.2 billion (EUR 1.37 billion). The completion secures the future of approximately 3,200 jobs and follows the agreement of new terms with customers and suppliers.
By this investment, the Chinese company intends to place the British Steel on a more competitive and sustainable footing and to return the company to industry comparable margins within five years.
Under the transaction, the initiatives include the development of an Electric Arc Furnace in Teesside, the construction of a new 250MW power plant to serve the Scunthorpe site, and a new rebar line. The projects also include the investment in the rolling mills to produce high-quality steel products to optimize the product portfolio and enhancement of the current rail mill.
“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,” Jingye Group CEO, Li Huiming, said.
The assets specified in the transaction include British Steel’s steelworks at Scunthorpe and UK mills at Teesside Beam Mill and Skinningrove, as well as subsidiary businesses FN Steel in the Netherlands and TSP Engineering. It does not include British Steel’s French operations at Hayange, the acquisition of which is still subject to further negotiations with the relevant authorities in France and is hoped to be concluded separately.