Mumbai: India's Tata Steel, Britain's largest steelmaker, is considering the sale of its entire UK business to stem heavy losses, a move that would draw a line under its almost decade-long foray into Britain.
After a marathon board meeting in Mumbai, the steel giant said in a statement in the early hours of Wednesday that the financial performance of its UK arm had deteriorated substantially in recent months, after years of weak conditions.
Blaming high manufacturing costs, domestic market weakness and increased imports into Europe from countries like China, the company said it saw little change ahead for its UK plants.
Tata said its European arm would now "explore all options for portfolio restructuring, including the potential divestment of Tata Steel UK, in whole or in parts".
"Given the severity of the funding requirement in the foreseeable future, the Tata Steel Europe Board will be advised to evaluate and implement the most feasible option in a time-bound manner," it added.
Tata Steel bought Anglo-Dutch steelmaker Corus in 2007 and has since struggled to turn the giant around in the face of a deteriorating market, slashing costs and thousands of jobs.
The company said it remained in talks with the UK government and with investment firm Greybull Capital over the sale of its British long products unit, which makes steel for use in construction. Talks with Greybull were announced last year.
British PM convenes emergency meeting
British Prime Minister Prime Minister David Cameron has convened an emergency steel summit on Thursday to discuss Tata Steel’s decision to sell its plants in the country.
According to reports, which quoted Downing Street, business secretary Sajid Javid will be flying back early from his trade visit to Australia.
Meanwhile, Opposition leader Jeremy Corbyn in the British parliament on Wednesday urged Mr Cameron to recall parliament from its Easter holiday to address the threat to jobs in the “strategic” steel sector.
“MPs must have the chance now to debate the future of steel and hold ministers to account for their failure to intervene. Steelworkers’ families will be worried about the uncertainty. The government is in disarray over what action to take,” he added....