British Steel on the verge of administration

Tuesday, 21 May 2019 17:22:32 (GMT+3)   |   Brescia
       

British Steel is on the brink of collapse unless it can secure £30m in emergency funding from the British government, putting over 4,000 jobs directly at risk and endangering 20,000 more in the supply chain. The money would be used to cover the company’s need for cash in its ongoing operations.

In past weeks, the UK's second-biggest steelmaker had been trying to secure £75 million in financial support to help it to address "Brexit-related issues", but media reports indicate that the bid has been reduced to about £30 million after Greybull Capital and the company's lenders agreed to inject £30 million into the company. Greybull is the fund that paid a nominal £1 to the loss-making company's previous owner Tata Steel in 2016 in order to purchase it and then renamed it British Steel.

The crisis comes only a few weeks after the British government provided the company with an emergency £120 million loan to cover a bill from the EU for its carbon dioxide emissions.

Company sources said that the direction of talks with the government would become clearer in the coming hours. Unless a deal is reached by today, May 21, the company could go into administration within 48 hours.


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