Tata Steel UK has agreed to sell its Long Products Europe business to investment firm Greybull Capital.
The deal, for a “nominal consideration”, will see Greybull Capital take on the whole of the standalone business, including assets and relevant liabilities.
It will cover Scunthorpe integrated steelworks, two mills in Teesside, an engineering workshop in Workington, a design consultancy in York, along with associated distribution facilities, and a mill in northern France. The Long Products Europe business employes 4,400 people in the UK.
Tata Steel last month said it had advised the board of Tata Steel Europe to consider selling Tata Steel UK after the business suffered 12 months of plummeting fortunes.
Bimlendra Jha, executive chairman of Long Products Europe, said: “Today marks a significant milestone in the sale of the Long Products Europe business. This sale is the best possible outcome for employees who have worked relentlessly to ensure the business’s survival, and helped to make it attractive to a potential buyer.”
Business secretary Sajid Javid said: “Today’s announcement is a step in the right direction for the long-term future of British steel manufacturing in Scunthorpe.
“This point wouldn’t have been reached without the efforts of all those involved, especially the high skilled workforce and local management. We will now look through the detail and stand ready to provide funding on a commercial basis if required.
“The UK and Welsh Governments are working tirelessly to ensure that we can now reach a deal for Port Talbot and the other Tata sites across the UK. This agreement sends positive signals to any potential investor for the rest of Tata’s UK business.”
Tata Steel said the Greybull Capital deal would be completed once a number of outstanding conditions had been resolved, including transfer of contracts, certain government approvals and the satisfactory completion of financing arrangements.