Business

China's Jingye Group in talks to buy British Steel for $123 million

BEIJING/LONDON: China's Jingye Group is in talks to buy British Steel, it said yesterday, in a deal estimated to be worth £70 million (S$123 million) that could protect thousands of British jobs.

Any agreement would be of major political significance in Britain as it prepares to elect a new government on Dec 12.

The lack of opportunities in northern England, where British Steel is based, is an election issue, as the social gap between north and south widens.

A spokesman for Hebei-based Jingye Group, a private company, said she was unclear about the value and whether further details would be announced this week.

Mr Gareth Stace, director-general of industry lobby group UK Steel, said nothing had been finalised.

"I would be surprised if it did not get finalised," he said.

"But it's not a done deal."

The company was put into compulsory liquidation on May 22 after Greybull Capital, which bought the firm for £1 from Tata Steel three years ago, failed to secure funding to continue its operations.

Its closure would impact 5,000 jobs in Scunthorpe and a further 20,000 jobs in the supply chain.

Mr Henri Murison, director of the Northern Powerhouse Partnership, set up to boost the economy in northern England, said a rescue deal would be "very welcome news". - REUTERS

BUSINESS & FINANCE