Major British Steel customer, Network Rail, has made an offer for Scunthorpe’s rail service centre.
The 海角视频 business is one of several national network companies that relies on the company for rail, with contracts in place across Europe.
It has stressed the “overwhelming preference” is for a buyer for the whole site, but is willing to step in for the section that deals with welding, finishing and storage of rail, should that not be possible.
British Steel was placed into compulsory liquidation when debts of £880 million were revealed at a High Court hearing. Owner Greybull was removed from day-to-day control with the Official Receiver appointed.
The move from Network Rail would ensure continuation of business operations, with bosses stating that there have only been two objectives throughout, to offer whatever support to British Steel, and to make sure it can continue to run the railway.
A Network Rail spokesperson said: “We continue to support British Steel, working with the liquidator and any new owner of the company. We have made an indicative offer for some railway critical assets although our overwhelming preference is that a purchaser for the entire business is found. We are very clear that our offer will not undermine that. Our role is to safely run the railway for the millions of people who rely on it every day and we are exploring all options to make sure we can continue to do that.”
Network Rail, together with counterparts in Northern Ireland, Italy and Belgium, renewed its contract with British Steel late last year, with the previous five year deal expiring in March.
It created demand for 200,000 tonnes – or 4,000km - of rail, building on the 9,000 km supplied prior to the signatures.
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The team in Scunthorpe works closely with the client, developing solutions to reduce maintenance. The contract included high performance HP335 and Zinoco, specially formulated for aggressive environments such as level crossings, tunnels and coastal routes.
The order was geared towards Network Rail’s Control Period Six (CP6), its five-year plan to maintain and improve Britain’s railways. CP6 runs between 2019 and 2024 and is designed to make the railway more reliable and cost efficient while increasing capacity and building on its reputation as the safest railway in Europe.
British Steel supplies Network Rail with 95 per cent of its rails, with the past your years of the current contract seeing it deliver 98 per cent of rail to Network Rail on time, in full.
Transport for London is also a major customer, with another extension agreed, having supplied 85 per cent of the capital’s demand in recent years.
It is understood a June 30 deadline was set by the Official Receiver for offers, with 10 reported to have been made. No immediate decision is likely, with those close to the process suggesting “discussions with interested parties are likely to take some time”.
The rail centre was significantly upgraded by Corus in 2006, with recent enhancements allowing it to produce longer lengths, sought after for the continental market. The team now has the capacity of producing 120m runs, while a coating facility to cope with that additional capacity was also invested in.