Ataer Holding selected as preferred bidder for British Steel

Ataer Holding, backed by a Government support package, had been picked as having the strongest offer for British Steel. The investment arm of OYAK, Turkey’s military pension fund, made the formal offer for the whole of British Steel.

Now selected as the preferred bidder, OYAK plans to take over the company by the end of the year. OYAK is the largest shareholder in Turkish steelmaker Erdemir.

The steel manufacturer went into compulsory liquidation in May, putting 5,000 jobs at risk as well as 20,000 in the supply chain.

The company was taken over by the Official Receiver, assisted by consultancy EY, who have been seeking a buyer for three months.

EY, appointed to assist the official receiver with his duties as company liquidator, made contact with more than 80 potential trade purchasers of the business.

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Commenting on the announcement, Gareth Stace, UK Steel director general, said: “Today’s announcement is enormously positive news for British Steel, its workers, and UK manufacturing as a whole. British Steel’s production facilities in Scunthorpe and elsewhere in the North East represent one third of the UK’s steel production and are a major strategic asset to our country; their loss would leave our manufacturing, construction and infrastructure capability in a considerably poorer state.

“While there is much work still to be done, today’s announcement is an important stepping stone on the way to securing a sustainable future for this cornerstone of British industry. Government support will undoubtedly be critical to taking the process forward from here, and its efforts and interventions provided to date are to be much welcomed.

“However, we must not lose sight of the longer term picture for the whole steel sector just as we see light at the end of this particular tunnel. It is important we move on from the current reactive approach, to one in which a shared, long-term strategic vision sits front and centre.

“The UK steel sector has a potentially bright future, underpinned by increasing UK and global steel demand for our products, but the Government must recognise the need to address the business environment in the UK which currently undermines our competitiveness. The steel industry is ready to invest in its future in the UK, all it requires is a partnership with the Government to help deliver a level playing field that can unlock its potential.”

Following the Government reshuffle in July, the new business secretary Andrea Leadsom visited the Scunthorpe steelworks of British Steel just three days into the job. She highlighted that selling the business as a whole remains a "top priority".

In the same month the UK steel industry received a boost from Heathrow Airport executives, who signed the 'UK Steel Charter' that plans to maximise the use of British metals in major projects like an expansion of the airport.

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The airport’s £14 billion third runway scheme will use approximately 370,000 tonnes of steel – offering a lifeline to the industry.

UK Steel director Gareth Stace said: “In signing the UK Steel Charter, Heathrow is giving steel producers the length and breadth of the UK the best possible chance of playing a major part in this exciting project.”

British Steel www.britishsteel.co.uk