British Steel buyer Jingye Group has told how a deal with the unions now agreed will help pave the way for long term growth.
The Chinese company reached agreement with representatives from Community, GMB and Unite, who together form the National Trade Union Steel Co-ordinating Committee.
And while up to 500 jobs may be lost, the focus is on a successful sale and keeping the works in Scunthorpe and the North East operational, with 4,000 employed across the entire business.
In a statement, Jingye Group said it was “pleased to have reached an agreement with union representatives on its proposed terms and conditions for British Steel employees,” adding that the business plan will successfully preserve the majority of jobs at British Steel, while providing the business with a platform for long-term, sustainable growth and profitability.
Jingye Group chief executive Li Huiming said: “We believe that this agreement lays the groundwork to provide well-paid, skilled jobs at British Steel for many years to come. It will pave the way for significant investment in the company that will transform the business and allow it to succeed.”
It now aims to complete the deal by the end of March, stating it continues to make progress on “securing all other necessary approvals”.
Jingye swooped after Turkish firm Altaer failed to come up with an offer after a period of due diligence exclusivity. A deal with the Official Receiver, understood to be worth £50 million with a stated £1.2 billion investment plan, was agreed in November.
British Steel had been placed into compulsory liquidation after a High Court hearing heard how debts of £880 million had been racked up under the ownership of Greybull, an investment house then stripped of any control as special managers were drafted in by the government-appointed official.
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Friday’s developments were welcomed by Scunthorpe’s new MP, Holly Mumby-Croft.
The Conservative, who ousted Labour’s sitting MP Nic Dakin in December’s General Election, said: “I want to pay tribute to everybody involved in these negotiations who are clearly all focused on a positive outcome.
“We don’t know the details of what and if the job losses will be, or how they will be reached, that will have to wait for when the details become available.
“My impression is that all parties have worked together to reach this.”
A former councillor representing the works’ neighbouring wards of Appleby and Broughton, her grandfather served for 30 years.
She recalled childhood tours of the works on the train, and him marching off to work in his steel toe-capped boots.
“It has been a huge part of my life, so close to my heart,” she said, well aware it will be a strong part of her future too. “It is not just the people on the site it matters to, but so many other companies rely on it also. It is so very important.”
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