UK steelmaker Corus has confirmed that it is to sell its plant at Redcar in the north east of England to an Italian-led partnership made up of two of Teesside Cast Products’ (TCP) five key customers.
Family-owned Marcegaglia, based in Northern Italy, will become the majority stakeholder in the plant, along with South Korean-based Dongkuk. Corus will retain a minority share of around 25%.
The transfer of ownership will effectively mean the end of the consortium of buyers - made up of Marcegaglia, Dongkuk, Duferco , Imsa (now Ternium), and Corus’ own downstream plants - brought together in 2004 to guarantee TCP’s future.
Last week, it emerged that the plant, which employs around 2,000 staff, had escaped swingeing job cuts as Indian-owned Corus scaled back its UK production.
TCP MD Jon Bolton said the plant would continue to supply all five of the former consortium members but the consortium deal had been torn up.
“It’s a different arrangement. The two members will have an equity share and we will continue to supply all of them - it’s very positive.”
The impact on local management of the plant is still unclear.
“Any change of ownership will have an impact but it’s difficult to say what that will be at the moment,” said Mr Bolton.
“As far as investment goes, they are aware of our plans.”
Last year, TCP reopened negotiations with the consortium on extending the supply deal beyond 2014.
Discussions revolved around major investment in the plant’s blast furnace.
The new deal, reportedly worth, $450m, will guarantee steelmaking stays on Teesside, Mr Bolton said earlier this week.
It relieves Tata-owned Corus of a large plant and helps restore stability to its balance sheet after a massive slump in world steel demand.
Source: Newcastle Journal
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