The British Steel name is set for a comeback even as the future of the UK’s biggest steel plant at Port Talbot hangs in the balance.
Greybull Capital, an investment firm, is close to completing the purchase of Tata Steel’s long products steelworks in Scunthorpe, Lincolnshire. As part of the talks, disclosed in December, Greybull is seeking to buy the British Steel brand.
Tata Steel acquired the name when it bought British Steel’s former business in 2007 in the acquisition of the Anglo-Dutch steelmaker Corus. The Indian company now plans to pull out of the UK entirely and is looking for a buyer for its blast furnace in Port Talbot, Wales, and other plants.
British Steel was formed in 1967 when the then Labour government nationalised the industry. It was sold off by the Thatcher government in 1988 and merged with Koninklijke Hoogovens of the Netherlands to form Corus in 1999.
Greybull is said to want to revive the brand because of its simplicity, resonance and association with quality, despite British Steel’s mixed record and history of industrial strife under state ownership. The heavy metal band Judas Priest released the album British Steel in April 1980, shortly after a three-month strike by the company’s workers secured a 16% pay rise.
If Greybull acquires the brand, it would not be available to a potential buyer for the rest of Tata’s UK business. Government ministers are sounding out possible purchasers and have asked Tata to keep the loss-making business operating while a buyer is found.
Greybull has not ruled out bidding for other parts of Tata’s business, including Port Talbot, though the steelmaking plant, with 15,000 workers, is larger and riskier than the Scunthorpe long products business, which turns steel into railway tracks and components used in construction.
A source familiar with Greybull said the firm was not in explicit talks about Port Talbot and was concentrating on completing the Scunthorpe deal. Any involvement in rescuing Port Talbot could depend on finding investment partners and the level of government support on offer.
A spokesman for Greybull declined to comment on whether the firm was considering further purchases from Tata Steel but said “talks are still ongoing and constructive” about the Scunthorpe plant.
ThyssenKrupp, the German conglomerate, emerged as a possible buyer for Port Talbot over the weekend. It was reported on Sunday evening that Sanjeev Gupta, the boss of Liberty House Group, had begun preliminary talks with Tata.
Liberty House last month bought two Lanarkshire mills from Tata Steel in a deal brokered by the Scottish government. Greybull had initially considered buying those plants as well as Scunthorpe.
Union leaders are due to meet on Monday to plan their next moves in the battle to save the steel industry, which has been damaged by falling prices, high energy costs and a glut of cheap Chinese steel.
Roy Rickhuss, the leader of the Community union, said: “This meeting will be a key moment in our campaign. We have an entire industry to save and not a lot of time to save it. We must also ensure that we hold Tata to a commitment to be a responsible seller and honour its moral and social duties to UK steel communities.”
