Chinese industrial giant set to rescue British Steel saving 4,000 jobs

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A Chinese industrial giant is set to come to the rescue of British Steel within days, buying out its embattled Scunthorpe plant and potentially saving 4,000 jobs, it has been reported.

After talks with a prospective Turkish buyer collapsed, the Jingye Group has become the leading contender to buy British Steel out of liquidation, with a buyout bid worth a reported £70 million on the table.

SWNS/Tom Maddick British Steel

SWNS/Tom Maddick British Steel

Jingye is also set to sweeten the offer with the promise it can also access up to £300 million in loans, indemnities and grants to back its plan to boost production at the plant by 10%.

Staff at the Scunthorpe facility have been told in an email that contracts between British Steel and Jingye have been exchanged, the Guardian reported.

The news comes after talks stalled between the steelmaker and Ataer. The Turkish firm is said to have fallen to third place in the bidding, also behind steel baron Sanjeev Gupta, who owns the UK-based Liberty House group.

Nic Dakin, the Labour candidate for Scunthorpe, said: "The workforce at British Steel have done an outstanding job continuing to make and sell steel through this difficult few months.

"It looks as if we're coming to a point where a new owner may well be determined and that would be very good news for the business and the communities that are around it."

Henri Murison, Director of the Northern Powerhouse Partnership said: “The prospect of a rescue deal for British Steel is very welcome news potentially safeguarding around 3,000 in Scunthorpe and another 800 on Teesside as well as 20,000 jobs in the supply chain.

"British Steel is a vitally important asset to the Northern Powerhouse and the UK’s global trading ambitions.

"It is time to return to putting the Northern Powerhouse on the One Belt, One Road of deeper cooperation with China and this acquisition demonstrates that potential buyers do believe British Steel, along with its highly dedicated and skilled workforce, can have a sustainable future.”