Comments
The British government announced on Thursday that it is willing to acquire a 25 per cent minority equity stake in Tata Steel’s UK operations as well as offer “hundreds of millions of pounds” in debt relief to rescue the troubled Indian steel giant by helping potential buyers.
UK Business Secretary Sajid Javid said the financial package would be jointly fashioned by UK and Welsh authorities; the government, he added, was “working closely with Tata Steel UK on its process to find a credible buyer“.
“We will work alongside a potential buyer to make sure that the government is doing what it can to support a viable sale,” British Prime Minister David Cameron’s spokesperson said.
“If we were to take an extra stake, it would be a minority one with the aim of supporting the purchaser in delivering a long-term future for the business; we are certainly not seeking to be controlling the company,” said the spokesperson.
Dismissing suggestions that the move would be perceived as part-nationalisation of the steel industry, she added: “We will be investing on a commercial basis. We will not be seeking to acquire control. We don’t think nationalisation is the right answer.”
Besides a minority stake, the UK and Welsh governments are considering additional grant funding, which could involve support for the development of power plant infrastructure, energy efficiency and environmental protection measures, R&D and training.
Pension impact
The government also said it was working with the pension scheme trustees of Tata Steel and British Steel to minimise any pension impact on the purchaser.
“This government is committed to supporting the steel industry to secure a long-term viable future and we are working closely with Tata Steel UK on its process to find a credible buyer.
“The detail of our commercial funding offer is clear evidence of the extent of that commitment,” said Javid, who had earlier this month rushed to Mumbai for talks with Tata Steel officials.
“Ministers have visited Tata Steel sites across the country and the pride and dedication of the highly skilled men and women working there is obvious to see.
“We have already delivered on energy compensation, on tackling unfair trading practices and on procurement of British steel, and we will keep going further to support this vital industry,” the Business Secretary added.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.