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Tata Steel has finally completed the sale of its Teesside Cast Products plant in the north of England, just under two years after it began its search for a buyer.
The firm announced late on Thursday that the ownership of $469-million worth of assets at the plant had been transferred to Sahaviriya Steel Industries UK, the subsidiary of the Thai group SSI.
The saga
The sale brings to an end a tough chapter in Tata Steel's operations in Europe which began in April 2009, when a consortium of buyers withdrew half-way through a 10-year contract to buy the bulk of TCP's product.
Tata Steel says that move cost it millions of pounds, and last year partially mothballed the plant.
With Britain in the midst of a recession at the time, and the north-eastern region where the plant is based heavily dependent on jobs at TCP, the move embroiled Tata Steel in a certain amount of controversy, with both local and national politicians entering the fray.
Tata Steel, however, kept its head low throughout, refusing to confirm or deny the numerous rumours of potential interest that circulated in the British press.
The deal
Clarity finally came this February, as Tata Steel and SSI announced a deal that would cover a number of assets at the plant, including the Redcar Blast Furnace, the Redcar and South Bank coke ovens, TCP's power generation facilities and the Lackenby steelmaking and casting facilities.
Tata Steel will retain a major presence, keeping ownership of the Teeside Beam Mill, the Skinnigrove Special Sections Mill, employing a total of around 1,800 people in the area.
The new owner
The deal won Tata Steel praise for its handling of the situation, including from Britain's Deputy Prime Minister, Mr Nick Clegg.
The mill's new owner SSI has pledged to invest around $150 million in capital expenditure “as part of a total $1 billion investment” – at the plant over the next couple of years, taking it to its full capacity of 3.5 million tonnes of slab steel, which will then be sent to the firm's rolling plants in Thailand. It is aiming to begin production by the end of the year.
The sale was one of the most positive developments in the steel industry for a very long time, said Mr Matt Ball, spokesperson for the steel workers union, Community, adding that they had “never seen a plant effectively close down and then be brought to life again. It is something our members have been waiting for a long time.”
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