Tata Steel has signed a letter of intent (LoI) with Liberty House to sell its UK speciality steel business, the company said in a statement on Monday. The deal, which also covers several South-Yorkshire based assets, is being pegged at an enterprise value of £100 million.
The announcement is in line with Tata Steel’s overall restructuring strategy of its UK portfolio. The letter gives Liberty House the right to enter into exclusive negotiations for the potential sale of steel assets.
Roy Rickhuss, General Secretary of Tata Steel UK Union, told CNBC-TV18 that further discussions and due diligence are required before a sale takes place. He added that the Union will meet with Liberty House and make sure it is satisfied with the terms of the deal.
Rickhuss said the union will be ensuring that Liberty has a proper plan to protect jobs and provide the long-term investment necessary to grow the business. “Crucial to this plan will be ensuring that the business’ loyal workforce have a pension plan that provides dignity and security in retirement,” he said.
Bimlendra Jha, Chief Executive of Tata Steel UK, said in the statement: “This is an important step forward in seeking a future for specialty steels... We look forward to working with Liberty on due diligence and other work streams so that the sale could be completed successfully. We will continue to work closely with trade unions.”Sanjeev Gupta of Liberty House said he expects due diligence to conclude in about 6 weeks’ time. He added that Tata Steel’s UK speciality steel business fits well with Liberty’s strategy.Watch videos for more...
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