Severfield shows it’s a good neighbour with helping hand for Greybull Capital

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The news that Severfield, Britain’s biggest steel work contractor, is unaffected by the steel woes besetting UK steel manufacturers is good news for the firm, its employees and its shareholders.

The Thirsk-based group said its order book has soared to a six-year high of £270m as it undertakes prestigious new contracts at Wimbledon’s No. 1 Court and Tottenham Hotspur FC’s new ground.

The shares rose 11 per cent to 52.5p on the news.

While Severfield’s star is rising after a difficult few years, it’s a very different story at Tata’s former Scunthorpe site, which has been bought by Greybull Capital and renamed British Steel.

In a show of regional solidarity, Severfield said it is keen to continue to take steel from the Scunthorpe site.

Severfield’s chief executive Ian Lawson said: “We will support them and still buy from them as long as the steel remains of the same high quality that it has been in the past.”

Severfield said there have been some notable changes to its steel supply chain in recent months, impacting two of the main types of steel it uses in the fabrication process.

Tata closed its UK steel plate production facility last December and there was also some concern over the future of is UK steel sections business.

“The sections business has now been bought by Greybull Capital, which removes the short-term uncertainty we were facing in respect of sections supply, and we have also managed to secure alternative sources of supply for all our plate requirements,” said Mr Lawson.

“While some of the issues around the UK steel industry have been highly publicised and a source of concern for many, it is important to recognise that only around 40 per cent of steel used in UK construction is produced in the UK, the majority being imported.”

He added that the changes have been managed with no disruptive impact on Severfield’s business.

The news that Severfield is keen to support the new British Steel and it hasn’t opted to switch supplier (which would have been an option if it wanted to avoid risk) is a healthy example of one Yorkshire company helping a neighbour.

What on earth is going on at Asda? First CEO Andy Clarke told us that Dewsbury-born Roger Burnley would take over after a hand over, then it was announced that Wal-Mart’s boss of China operations Sean Clarke is to get the top job.

Talk about confusing. When asked the age and nationality of Sean Clarke, no-one at Asda House seemed sure of the answer.

Asda’s US parent Wal-Mart is calling the shots. Once the jewel in Wal-Mart’s international crown, Asda is haemorrhaging sales to Aldi and Lidl.

If Sean Clarke is to succeed, Wal-Mart needs to allow him to introduce a full out price war.

Wal-Mart needs to untie the hands of its Asda CEO. Otherwise Sean Clarke will go the same way as his predecessor.