Tata Steel will begin by Monday the formal process of selling its UK plants.
This was disclosed by UK’s Business Secretary Sajid Javid after his meeting with Tata Group Chairman Cyrus Mistry here on Wednesday. Javid met Mistry in a bid to avert the closure of the struggling Port Tablot steel plant.
Though Tata Steel has decided to sell the loss-making steel plant in UK, insiders feel that the plant will eventually be shut down as it has not attracted much interest from buyers, except from Sanjeev Gupta-owned Liberty House.
Javid spent about two hours at Bombay House, the headquarters of the Tata Group. Tata Steel declined to give details on the outcome of the meeting.
Liberty House promoter Gupta, 44, had a meeting with Javid in London before the latter flew to Mumbai for the meeting with Mistry, said sources. They added that efforts will be made to ensure job security for the 15,000 employees at the UK plant.
Earlier, Koushik Chatterjee, Group Executive Director (Finance and Corporate), Tata Steel, said the company will work closely with the UK government to find a potential buyer for the UK assets.
Liberty House’s conditions Gupta has sought various financial concessions and a write-off of a £2-billion pension liability. He also wants to temporarily shut down the blast furnace to convert it into an arc furnace. The transition, which would enable the company to produce steel from scrap sourced domestically, would take about 18 months and involve the re-training of existing workers. Currently, Port Tablot incurs a loss of £1 million a day.
Liberty House had agreed to acquire two steel facilities of Tata Steel at Clydebridge and Dalzell in Scotland through a deal negotiated by the British government.
Gupta had also acquired a 1.5 million tonnes per annum steel plant in Wales. The plant produced steel based on the electric arc furnace and has a downstream hot rolling mill.
Liberty House has revenues of about $5 billion, covering steel, raw materials and non-ferrous metals, and employs over 2,000 people globally.
It produces about 5 million tonnes per annum of steel and steel products.