Chinese firm Jingye Group acquired British Steel whose company is under compulsory liquidation since May 2019. The acquisition saved more than 3,000 staff from losing their jobs and were reoffered contracts. However, 400 other personnel were laid off due to the redundancy of employee functions.
According to The Guardian, JIngye Group revealed in a statement that it had completed the acquisition of British Steel's UK and Dutch assets. The shares were purchased through an official receiver who confirmed Jingye Group's investment of 1.2 billion euros into the company.
Last week, Jingye Group announced its plans to officially acquire significant stocks from the company by taking control of British Steel's main plant in Scunthorpe. The project was realized despite the absence of confirmation by the French government over the deal.
According to Jingye Group's chief executive officer (CEO) Li Huiming, the acquisition was a challenge for the company since it first announced the plan last November. The report claimed that the French government treated British Steel's operations as a significant part of its strategic activity. It was further explained that the French government also expressed its interest in purchasing that which Jingye Group acquired.
This Monday, Jingye Group further announced that it still wants to acquire stocks of the company from the Hayange. The statement showed that the matter is still on the table for further negotiations. At the same time, France still wants a separate decision from that of Jingye's acquisition over shares it intends to purchase from British Steel.
The report further revealed that JIngye Group wants to install an electric arc furnace made from recycled steel as part of its investment plans for British Steel. The Chinese firm also indicated that it intends to build a more efficient power plant and possibly launch a new steel rebar line that would be mainly used in construction.
British Steel was under compulsory liquidation last May 2019 after equity firm Greybull Capital failed to secure its funding plans. The lack of funds resulted in the blockage of operations for British Steel. Globally, the steel industry where British Steel suffers from declining demand and slowing business activity due to the public health crisis in China.
In other news, BBC Business reported that the acquisition included the Chinese takeover of mills in Teesside and Skinningrove including the TSP Engineering business of British Steel in Cumbria.
Jingye Group was also reported to produce steel like the acquired corporation. It also promised to invest 1.2 billion euros over the next ten years and would upgrade its internal plants and machinery.
