British Steel yesterday was set to announce a rescue deal by Chinese industrial giant Jingye Group (敬業集團), a source close to the matter said.
Jingye’s spokeswoman earlier confirmed that the Chinese group’s chairman was in Britain for talks.
Reports said Jingye would pay about ￡70 million (US$90 million) for British Steel, which collapsed into liquidation in May.
If agreed, it would mark a new lease of life for the steelmaker, which collapsed after last-ditch talks with its owners failed to secure a full financial rescue.
Turkish military fund OYAK last month pulled out of a deal to rescue British Steel, whose owners, Greybull Capital, had blamed Brexit for the firm’s financial collapse.
Hebei Province-based Jingye Group specializes in iron and steel, but has investments in tourism, hotels and real estate.
According to its Web site, it has total assets of 39 billion yuan (US$5.5 billion) and 23,500 employees.
Although it did not take the steel producer into state ownership, the UK government said in May that it would keep paying staff wages in the hope that a buyer could be found.
Steel groups have blamed cheap imports from China for their recent difficulties. The European Steel Association in May urged the EU to help the sector, which it said has been swamped by cheap Asian steel since the US imposed import tariffs last year.
About 5,000 people are employed by British Steel and an estimated 20,000 more have links to the firm’s supply chain.
A total 4,000 British Steel staff work in the UK, with an additional 1,000 based in France and the Netherlands.
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