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Business & Economy

China’s Jingye Group confirms British Steel takeover deal

A Chinese steelmaker has vowed not to “misplace the trust” afforded to it after agreeing a deal for an operator employing hundreds of North East workers.

Jingye Group will take over British Steel on March 9.

Bosses say confirmation of the deal – which they add will unlock a £1.2 billion modernisation investment – has saved 3200 UK-wide jobs, including hundreds across the North East.

Under the terms of the sale, Jingye Group will take over the running of British Steel’s Teesside Beam Mill, based near Redcar, and a special profiles factory, in Skinningrove, east Cleveland.

A Blaydon-based metal centre, used by British Steel to offer customers access to products, as well as processing and service support, will transfer to stockholder Barrett Steel in a separate sale.

Jingye Group’s deal comes after British Steel – founded when Tata Steel sold its Long Products division to investor Greybull Capital – collapsed into compulsory liquidation last year.

Ataer Holdings, a steelmaking subsidiary of the Turkish military pension fund, had been favourite to acquire the business but after exclusive talks ended in October, Jingye Group stepped in.

Speaking about its desire to revitalise Britain’s steel network, Li Huiming, Jingye chief executive, said: “We are delighted to have reached this agreement and look forward to completing the initial transaction over the coming days so we can begin a new chapter in British steelmaking.

“I want to thank everyone who has been involved in making this deal happen, including British Steel employees, the unions and the British Government.

“We will not misplace the trust that they have placed in us.

“We are excited about what we can collectively achieve at British Steel to build a successful future for many years to come.”

Greybull Capital paid India’s Tata a nominal £1 for its Long Products division.

After setting out ambitious targets for its future, and securing a number of high-profile contracts, the company began to struggle and eventually collapsed into liquidation last year, with a Government-appointed official receiver overseeing operations ever since.