UK May Invest In Tata Steel's Local Unit To Save Jobs
22 April 2016
The British government said Thursday that it could take a stake of up to 25% in the local operations of Tata Steel, which the Indian steelmaker is looking to sell, to help save the thousands of jobs that could potentially be lost if steel mills were closed.
As part of a financial support package to the company that buys the business, the government also intends to reduce debt by hundreds of millions of pounds (100 million pounds equals $143 million).
The U.K. government would make the investment jointly with the government of Wales, home of the steelworks. Amid a global glut that has caused steel prices to fall, Tata Steel announced at the end of March that it intends to sell its U.K. business. British commodities company Liberty House has shown interest in buying some of the operations.
Tata Steel employs some 15,000 workers in the U.K., with Wales especially dependent on the steel industry. Mill closures are seen having a major impact on the supply chain, possibly leading to the loss of roughly 20,000 jobs. Concerns over regional economies have prompted the British government to consider various rescue measures, including partial nationalization.
British Business Secretary Sajid Javid promised that the government will provide support to help the local steelmaking industry survive over the long term, indicating that it will work with Tata Steel to find a buyer.
Source : asia.nikkei.com