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Report: British Steel to collapse unless UK government extends £30M loan

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Report: British Steel to collapse unless UK government extends £30M loan

British Steel Corp. Ltd. may go under and about 5,000 jobs are on the line unless the U.K. government agrees to grant a £30 million emergency loan May 21, Reuters reported the same day, citing a source close to the situation.

Administrators EY may be appointed as early as May 22 should the company fail to secure the loan. Unions representing British steelworkers demanded that the U.K. government extend the loan.

Earlier this month amid the uncertainty surrounding Brexit, British Steel reached out to the U.K. government for £70 million to £80 million in crisis funding to avert a collapse that would lead to thousands of job losses. However, it lowered the request to £30 million after its owner, Greybull Capital, agreed to contribute more funds, Reuters added.

The U.K. government had agreed to loan British Steel £120 million to fulfill payments to an EU environmental program.