Liberty House, an international industrials and metals group which has a commodities business based in Dubai, said it has entered into exclusive negotiations with Tata Steel UK, a unit of India’s Tata Steel, to acquire its speciality steels operation for £100 million (Dh458m).
If it goes through, the deal will secure the jobs of 1,700 steel workers at major production facilities in Rotherham and Stockbridge, a mill in Brinsworth and at service centres in Wednesbury and Bolton. Additionally, thousands of more jobs in the UK supply chain will be ensured.
“The planned deal, in combination with Liberty’s existing industrial footprint in the UK, would establish the group as one of Britain’s most significant steel and engineering employers,” the company said yesterday.
The operations that are to be acquired are based largely in South Yorkshire with service centres in the West Midlands and Lancashire. It manufactures a range of high-value speciality steel products for the automotive and aerospace sectors.
Sanjeev Gupta, the executive chairman of Liberty House Group, spoke to The National in June.
He said then his plan was to transform the fortunes of UK steel by snapping up distressed businesses and replacing iron ore furnaces with more efficient “green” mills that recycle scrap steel, then use the product in a range of “value-added” businesses, such as the Caparo Industries steel products firm he acquired from administrators last year and a business producing steel towers and wind pylons for offshore projects at newly acquired sites in Scotland.
“The UK steel industry, and UK industry related to steel, is at a crossroads at the minute,” he said in June. “To put it bluntly, it has failed disastrously.” He pointed to the fact that the UK steel industry uses 21 million tonnes of steel and steel products each year.
Of the 10 million tonnes of raw steel used, 60 per cent is imported. However, the country also exports more than 70 per cent of the 10 million tonnes of recycled steel produced each year.
He said that the GFG Alliance, a group of companies including Liberty’s commodities, steel and engineering arms, as well as his father’s Simec Group, which has interests in energy, mining and shipping, had the support and the financial clout to be able to deliver its objectives.
The GFG Alliance is forecasting a US$6.7 billion turnover and earnings before tax, interest, depreciation and amortization (Ebitda) of $140m this year, rising to $10bn and $300m, respectively, by 2020.
Tata Steel’s shares closed yesterday up 0.48 per cent to 409 rupees in Bombay following the news.
mkassem@thenational.ae
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