British Steel Corp. Ltd. owner Greybull Capital LLP is readying a bid for the collapsed group's operations in France and the Netherlands to forge a new continental steel business, London's Financial Times reported June 4, citing people briefed on the plan.
British Steel, which the private equity firm bought three years ago from Tata Steel Ltd. for £1, was declared insolvent in May after the government said it could not provide a £75 million loan that Greybull and company management said was needed to keep it afloat. Just weeks before, the government had given the firm £120 million to help it pay an EU carbon emissions bill.
Liquidators were appointed to find new owners for British Steel, which is centered on the Scunthorpe plant in the U.K., in a bid to save thousands of jobs.
Greybull reportedly hopes to merge the Hayange factory in France and FN Steel in the Netherlands with Ascoval, a French steelmaker it bought in May. The European businesses are not in liquidation, but they are controlled by the government-mandated receiver, who will also decide whether to sell the entire business or break it up.
Trade unions are likely to attack Greybull's attempts to cherrypick parts of the business that collapsed into administration under its management.
Alasdair McDiarmid, operations director at the U.K. steelworkers' union Community, said the business needs to be kept together to protect jobs, the FT added.
Greybull did not immediately respond to questions from S&P Global Market Intelligence about the FT report.