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British Steel says seeks more govt financial support 

Making plans for British Steel
Making plans for British Steel AFP
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London (AFP)

British Steel on Tuesday said it was seeking more financial support from the UK government, as it faces Brexit strains and sector-wide uncertainties.

In a statement, British Steel said that "discussions are continuing about a package of additional support to assist the company address broader Brexit-related issues, whilst continuing with its investment plans".

The government agreed two weeks ago to inject £100 million ($129 million, 115 million euros) in funding to help British Steel pay its latest carbon emissions bill to the European Union.

Britain's second biggest steelmaker wants another loan of £75 million to avert its demise, Sky News reported citing unnamed insiders, adding that insolvency experts were on standby.

A collapse of British Steel would spark the loss of up to 5,000 jobs at the group's sprawling steelworks in Scunthorpe, northern England.

The news comes amid uncertainty over the future of Tata Steel's main European operations based in the UK after German industrial conglomerate Thyssenkrupp last week scrapped merger plans with the Indian giant.

A deal was seen as positive for Tata's Port Talbot plant in Wales that employs more than 4,000 staff.

Following the merger collapse, Thyssenkrupp said it would slash 6,000 jobs worldwide in a structural shakeup.

The German group said "continuing concerns" from the European Commission had sunk its bid to join its steel business in Europe with that of Tata's.

British Steel is meanwhile the second biggest operator of the metal in the UK after Tata.

It is owned by investment firm Greybull Capital, who founded the long steel products maker in 2016 after snapping up assets from Tata Steel.

Long steel products comprise plates, rails for railways, sections used in construction, and wire rod. The latter can be used as steel rope for infrastructure like suspension bridges or filaments for car tyres to give rigidity.

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