News: Speciality Steel UK nationalisation - what happens now?
The Government's work towards the public acquisition of Speciality Steel UK (SSUK) is expected to take between four and six months, but Business Secretary Jonathan Reynolds wants it to be resolved as quickly as possible.
The Government took the step as it found that the private sector proposal from the preferred bidder "could not provide the long-term stability, certainty and value for money that workers, communities and taxpayers deserve."
Reynolds told the House of Commons: "That bidder subsequently requested Government support to make its purchase of Speciality Steel UK possible. However, following extensive engagement between the bidder and its advisers, and having done all the due diligence and given the case the consideration that taxpayers would expect, the Government have decided that they cannot provide support on the proposed terms."
He added that the Government had "serious concerns about the proposed financing of it."
The company’s sites support over 1,300 jobs in Rotherham, Stocksbridge, Brinsworth and Wednesbury.
The public acquisition move means that a liquidation process has been postponed, giving the state a strategic control over the future of a business that it believes has a unique place in the UK’s steel ecosystem due to its specialist steelmaking capabilities.
The government will work with local leaders, industry experts, private investors, workers and other partners to consider what is best for the strategically important locations. Taking between four and six months, the work will look at "future industrial use, regeneration opportunities and the role that specialist manufacturing capabilities could play in supporting growth and our national resilience."
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The future of speciality steel production will be high on the agenda and the assessment will include the consideration of products, customers and markets if the business is to be run profitably.
The Business Secretary explained: "The work we can now do will have to look at the capacities, the potential for new investment that might be required, the product lines, where the customers are and so forth.
"The key issue — I am not sure if this has ever been put on the record in Hansard before — is homologation. That is the assets of these sites and the accreditations they have for such a speciality set of products. Those assets are incredibly valuable. Not many parts of the world can produce to the standard that we are talking about. We now have a process — I want that to be as short as possible — where we can assess that."
Reynolds also discussed the potential costs involved - from running the business in public ownership, and from the remediation and regeneration of the sites. He said: "If this were a matter of public ownership, we would have to pay off the creditors, reach an accommodation with them, acquire the assets, and then inject some working capital over a period of between one and three years. I would expect the cost of that to be about £350 million, and I would expect something comparable were the option to be regeneration and remediation."
The government already has the powers following its previous work on British Steel in Scunthorpe. The Steel Industry (Nationalisation) Act 2026 gives the government powers to bring critical steel manufacturing companies into public ownership when it is in the public interest.
Labour’s 2024 election manifesto pledged £2.5 billion to rebuild and modernise the UK steel industry, a commitment now being channelled through the National Wealth Fund. This is on top of £500m that was granted to Tata in Port Talbot under the previous Government.
The Business Secretary was also critical of the way the business was run as Liberty Steel. He told the house that the business only produced when the customer effectively supplied working capital. Reynolds called this "a highly irregular position, but one reflective of the opaque and byzantine financing arrangements under the previous owners. I believe the opportunity exists to operate a successful business in this space. There is nothing ideological about this; my ideal is for the business to be run in the private sector."
Many of the workers at SSUK have been furloughed and the plants have not been operating for several years.
Reynolds concluded: "I want to speak directly to the workers of Speciality Steel UK, who have been stuck on furlough, unable to do the jobs of which they are so rightly proud, through no fault of their own. I know that they feel ignored and let down by previous Governments, but as Business Secretary, I will not duck these difficult decisions, and neither will this Government. I will do all that I can to secure a bright future for you, your communities and your families."
Following the announcement, Unite general secretary Sharon Graham said that the government needs "to get on and nationalise the company.”
Images: SSUK
The Government took the step as it found that the private sector proposal from the preferred bidder "could not provide the long-term stability, certainty and value for money that workers, communities and taxpayers deserve."
Reynolds told the House of Commons: "That bidder subsequently requested Government support to make its purchase of Speciality Steel UK possible. However, following extensive engagement between the bidder and its advisers, and having done all the due diligence and given the case the consideration that taxpayers would expect, the Government have decided that they cannot provide support on the proposed terms."
He added that the Government had "serious concerns about the proposed financing of it."
The company’s sites support over 1,300 jobs in Rotherham, Stocksbridge, Brinsworth and Wednesbury.
The public acquisition move means that a liquidation process has been postponed, giving the state a strategic control over the future of a business that it believes has a unique place in the UK’s steel ecosystem due to its specialist steelmaking capabilities.
The government will work with local leaders, industry experts, private investors, workers and other partners to consider what is best for the strategically important locations. Taking between four and six months, the work will look at "future industrial use, regeneration opportunities and the role that specialist manufacturing capabilities could play in supporting growth and our national resilience."
Advertisement
The future of speciality steel production will be high on the agenda and the assessment will include the consideration of products, customers and markets if the business is to be run profitably.
The Business Secretary explained: "The work we can now do will have to look at the capacities, the potential for new investment that might be required, the product lines, where the customers are and so forth.
"The key issue — I am not sure if this has ever been put on the record in Hansard before — is homologation. That is the assets of these sites and the accreditations they have for such a speciality set of products. Those assets are incredibly valuable. Not many parts of the world can produce to the standard that we are talking about. We now have a process — I want that to be as short as possible — where we can assess that."
Reynolds also discussed the potential costs involved - from running the business in public ownership, and from the remediation and regeneration of the sites. He said: "If this were a matter of public ownership, we would have to pay off the creditors, reach an accommodation with them, acquire the assets, and then inject some working capital over a period of between one and three years. I would expect the cost of that to be about £350 million, and I would expect something comparable were the option to be regeneration and remediation."
The government already has the powers following its previous work on British Steel in Scunthorpe. The Steel Industry (Nationalisation) Act 2026 gives the government powers to bring critical steel manufacturing companies into public ownership when it is in the public interest.
Labour’s 2024 election manifesto pledged £2.5 billion to rebuild and modernise the UK steel industry, a commitment now being channelled through the National Wealth Fund. This is on top of £500m that was granted to Tata in Port Talbot under the previous Government.
The Business Secretary was also critical of the way the business was run as Liberty Steel. He told the house that the business only produced when the customer effectively supplied working capital. Reynolds called this "a highly irregular position, but one reflective of the opaque and byzantine financing arrangements under the previous owners. I believe the opportunity exists to operate a successful business in this space. There is nothing ideological about this; my ideal is for the business to be run in the private sector."
Many of the workers at SSUK have been furloughed and the plants have not been operating for several years.
Reynolds concluded: "I want to speak directly to the workers of Speciality Steel UK, who have been stuck on furlough, unable to do the jobs of which they are so rightly proud, through no fault of their own. I know that they feel ignored and let down by previous Governments, but as Business Secretary, I will not duck these difficult decisions, and neither will this Government. I will do all that I can to secure a bright future for you, your communities and your families."
Following the announcement, Unite general secretary Sharon Graham said that the government needs "to get on and nationalise the company.”
Images: SSUK
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