Sanjeev Gupta to acquire Tata Steel’s Talbot unit
Sanjeev Gupta, a UK based steel magnate is in talks with the owners of Tata Steel to acquire its plants at Port Talbot. The decision if fruitful is likely to come to the rescue of Tata Steel’s troubled steel business in UK, which could save the company from impending collapse and job losses.
Gupta has also announced that he is ready to discuss the same with the British government to save the Talbot plant where thousands of jobs are at loss. The founder of steel, commodities and property group Liberty House had in the past managed to save a lot of steel plants from closure.
He would meet the British government and the Tata officials to see the support they are willing to offer to help one of the largest plants from shutting down. Tata Steel’s UK plant has been suffering loss for almost a decade now.
With regard to acquiring of the steel plant, Sanjeev Gupta said, “We would need a proper partnership with the Government. I don’t know what that would entail at this stage. We are in the process of starting a discussion with Tata.”
Gupta has submitted an initial proposal to the UK government, where he has proposed to replace the blast furnace with modern electric arc furnaces. These furnaces are used in the process of melting scrap to produce raw steel. The whole process of replacement is likely to cost as much as 1 billion euros.
Gupta emphasized that the problem with Talbot plant is that it functions around blast furnaces. These furnaces produce steel from liquid ores. However, Liberty House’s plants are based on producing steel from scrapping metals, a process that is facilitated by using modern electric arc furnaces. He also said that, the size of the Talbot plant could pose a problem.
Sanjeev had recently purchased two of Tata’s rolling mills at Scotland, where the Scottish government enabled a short-term nationalization.
However, Tata steel on the lines of implementation said that, there are “no fixed timelines” for the sale process. “It needs to be implemented urgently as there are severe funding requirements affecting the UK operations.”
Gupta added that, “I haven’t made a proposition that I want to buy all of Tata Steel UK because that’s too big an undertaking to even put on the table at the stage. If the company, it’s people, it’s workers and the Government would be willing to consider my suggestions then I am willing to engage in a discussion about what role we will play in that.”
Tata steels UK plant has been bearing a loss of more than 1 million pounds per day. Due to this the parent company has taken a decision to sell all or parts of its operations around the country.
And the government has also been criticized heavily for its meek response and for the fact that it is also against nationalizing the assets.
