The British branch of Tata Steel is about to receive hundreds of millions of pounds of state aid. That reports business newspaper Financial Times based on insiders.
The rescue package must save thousands of jobs.
It would be the first significant loan under Project Birch, which the UK government wants to help strategically important companies affected by the corona crisis, among other things.
It is said to be a government loan of £ 500 million. Businesses that rely on Project Birch should have exhausted all other options. There are also strict conditions. In the case of Tata Steel, among other things, about reducing CO2 emissions and personnel guarantees.
About 8,000 people work for Tata Steel in the UK. The company owns, among other things, the country’s largest steel mill in Port Talbot in Wales.
The deal may close within a few days, but could also just go wrong according to sources. Tata Steel herself does not want to respond. “It would not be appropriate to comment on ongoing discussions with governments,” the company said.
The British steel industry has moved from one crisis to another in recent years. International competition, high production costs and low investments undermined the sector.
The temporary shutdown of parts of the UK economy as a result of the corona crisis has reduced the demand from British car manufacturers and construction sites for steel.