Tata Steel UK Limited (Tata Steel) has said it will sell certain assets of Teesside Cast Products (TCP) to Sahaviriya Steel Industries UK Limited (SSI), a subsidiary of Thailand?s largest steel producer, in a $469 million deal . The Teesside plant was partially shut in February last year following the decision of four steel slab buyers to pull out of a 10-year contract. The deal is expected to be completed by March and SSI said it plans to restart production by the end of the year.
The assets covered by the sale include the Redcar Blast Furnace, the Redcar and South Bank coke ovens, TCP?s power generation facilities and sinter plant, and the Lackenby steelmaking and casting facilities.
The deal will also result in a joint venture of Tata Steel and SSI to operate Redcar Wharf (TCP?s bulk terminal), giving Tata Steel the flexibility to use Teesside to serve its other steelmaking operations, while also meeting SSI?s requirements on Teesside. Tata Steel will continue to operate two large-diameter tube mills in Hartlepool, the Skinningrove special sections mill, Teesside Beam Mill and Teesside Technology Centre. Shares of Tata Steel were up 1% on the BSE to close at Rs 608 on Friday.
Karl-Ulrich K?hler, MD & CEO of Tata Steel in Europe, said, ?I am very encouraged that after all our efforts we have been able to reach this agreement, which is good news for the highly skilled and dedicated Teesside workforce.?
He added that Tata Steel intends to retain a major presence in Teesside. ?After the successful completion of this transaction, Tata Steel will remain one of the largest private-sector employers in the area with more than 1,800 employees,? he said.
Win Viriyaprapaikit, president of SSI, said, ?Owning Teesside Cast Products will enable us to achieve our long-standing ambition of becoming a fully integrated steel producer. This transaction will give us a strong platform for future growth, increase our resilience to industry cycles and give us opportunities to diversify into new markets and products.?