Fears are mounting over the future of Liberty Steel UK after the Government rejected pleas for a £170million emergency loan.
The company, which employs around 5,000 workers at 11 sites in Britain, sought a bailout after the collapse of its financial backer Greensill Capital.
However it is understood that the Government rejected the request amid concerns about the structure of the company.
The parent company, GFG Alliance, will restart steelmaking in the UK on Monday as it continues to seek funding to bolster its finances.
Business Secretary Kwasi Kwarteng was due to hold talks with union bosses yesterday.
Ross Murdoch, GMB National Officer, said all options must remain on the table, including “taking the UK business into public ownership.”
Roy Rickhuss, General Secretary of Community union, said: “These are extremely challenging times, and we hope [founder Sanjeev] Gupta will succeed in obtaining the necessary financing with or without Government support.
“However if he is not able to do this then Government must step in to protect the jobs and assets.”
Labour ’s Lucy Powell urged ministers to “put aside ideology”, adding: “It’s in our national interest to safeguard jobs and domestic steel-making capacity. The ball is now in the government’s court.”
A Government spokesperson said: “The Government is closely monitoring developments around Liberty Steel and continues to engage closely with the company, the broader UK steel industry and trade unions.”
A GFG Alliance spokesperson said: “Liberty Steel UK continues in constructive discussions with the UK government on measures to supplement these efforts and to highlight the importance of this business to the UK’s industrial supply chains.”
