£100m deal helps secure future for Wednesbury Tata Steel workers

They are part of Tata Steel's Speciality Steels business that has just been sold to Liberty House Group.

Negotiations started in November and the sale deal has been signed today.

It puts the business of the growing UK steel business headed by Sanjeev Gupta, who led the rescue of nearly 1,000 Black Country steel jobs in 2015 following the collapse of Caparo Industries.

The new sale agreement covers several South Yorkshire-based assets including the electric arc steelworks and bar mill at Rotherham, the steel purifying facility in Stocksbridge and a mill in Brinsworth as well as service centres in Bolton and Wednesbury, and in Suzhou and Xi'an, China.

Speciality Steels directly employs about 1,700 people making steels for the aerospace, automotive and the oil & gas industries.

Bimlendra Jha, CEO of Tata Steel UK, said: "This is good news for Speciality Steels and for Tata Steel's core business in the UK. For Speciality Steels, which is largely independent of our European strip products supply chain, this is an important step forward in securing a future for the business under new ownership. Today's news also marks another important step forward in realising a more sustainable future for our Port Talbot-based supply chain in the UK."

Mr Jha added: "Like our former Scunthorpe-based Long Products business which we sold last year, we will be handing over a business which has been transformed following difficult decisions to restructure and re-focus on higher-value markets.

"Employees, trade unions and the management team have worked incredibly hard at Speciality Steels to improve its performance and I'm delighted to say that the business is now on an improvement track which will enable it to thrive in the future."

Tata Steel's strip products business will continue to employ almost 8,500 people in the UK, manufacturing advanced products for sectors like the automotive industry by utilising the unique capabilities of blast furnace steel making. The company also employs nearly 500 people at its Steelpark distribution base in Wednesfield, as well as workers at sites in Walsall and Brierley Hill.

The Speciality Steels group now becomes part of Liberty's growing steel operations across the UK, which includes the Oldbury-based former Caparo business across the Black Country and sites in South Wales and Scotland.

The deal will make Liberty one of the largest steel and engineering employers in the UK with more than 4,000 workers at plants located across Britain's industrial heartlands.

Speciality Steels has the capability to make around 1.1m tonnes of liquid steel per year from recycled scrap, melted in two electric arc furnaces at Rotherham. This steel feeds downstream casting, re-melting and rolling processes, producing a range of high-value steels.

Liberty works with energy company SIMEC – a fellow member of the GFG Alliance – to deliver a GreenSteel strategy, which involves the recycling of UK scrap using renewable energy. Liberty says the Speciality Steels acquisition is "a major step forward" for this strategy as it gives the group melting capacity in Britain for the first time. In late 2016 Liberty also created Liberty Metal Recycling to secure supplies of scrap steel generated in the UK economy.

Sanjeev Gupta, executive chairman of the Liberty House Group said: "I am proud that we are acquiring a world-class business with a very skilled workforce and broad range of high-value products. It is one of only a handful of such operations in the world and I am confident it will flourish within our group.

"Fulfilling the next key stage of our Greensteel vision is incredibly exciting. We will now be able to melt scrap steel to create high-value-added products and I hope that, in due course, we will do so using renewable power.

"In the very week that Liberty is celebrating its 25th anniversary, I am delighted to welcome many hundreds more members to the Liberty family. We are grateful for the support from all stakeholders in achieving this deal, including the employees, unions and advisers."

Business Secretary Greg Clark said: "Acquiring Tata's Speciality Steels business in South Yorkshire and West Midlands, which manufactures high quality steel for some of the UK's world leading industries such as aerospace and automotive is a great opportunity for Liberty House. I look forward to hearing more about their expansion plans which secures skilled jobs at the business into the future.

"We want to work with the steel industry on proposals to transform and upgrade their sector as part of the modern Industrial Strategy so we can build on our strengths and extend excellence into the future."