News: Tata to proceed with sale of South Yorkshire operations - reports

Tata Steel will proceed with the sale of its speciality steel making business, whilst pausing the sale of most of its UK business, including Port Talbot - according to a report by the BBC.

The Indian-owned steelmaker concluded that it is exploring all options for portfolio restructuring including the potential sale of Tata Steel UK, in whole or in parts. The formal process began on April 11 with contact made with 190 potential financial and industrial investors worldwide.

Seven bids were immediately taken forward to the next stage but a shortlist of bidders has never been confirmed and the sale process was suspended. Since the announcement in March, there has been rising steel prices, a turnaround at Port Talbot, announcements from the Government on support for the industry, consultation on the pension scheme, a fall in the price of the pound and the EU referendum.

A Tata Steel board meeting is scheduled to be held in Mumbai tomorrow with Business Secretary Sajid Javid, flying in for talks with Tata executives.

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The report said that "Tata has recently adopted a more relaxed approach to determining its future, as Government incentives to keep the business going have come in thick and fast.

"It will pause the sale of most of its UK business, including Port Talbot .... However, it will proceed with the sale of its specialty steel making business, which employs 2,000 employees in Hartlepool, Rotherham and Stocksbridge."

Speciality Steels has a £275m of turnover and is Tata Steel Europe's only Electric Arc Furnace (EAF) based business, specialising in carbon, alloy and stainless steels for demanding applications like aerospace, motorsports and oil and gas. Until recently it employed over 2,000 people at sites like Aldwarke in Rotherham and Stocksbridge in Sheffield. It is not considered a downstream business linked to Port Talbot and Tata Steel's strip products.

Bids from investors seeking to cherry-pick parts of the operation were initially rejected. Albion Steel, a new vehicle led by former Corus CEO, Tony Pedder, is reported to be lining up behind JSW Steel of India with a view to acquiring Tata's specialist steels division in South Yorkshire.

It was also reported that KPMG, engaged by Tata Steel as advisers to the sale process, was asked to contact prospective bidders for the Speciality Steel business in South Yorkshire and the pipeline tube operations.

Steelworker's unions have been calling for clarity of their future, adding that "since that first announcement, the trust and good will of Tata's loyal workforce has been pushed to the limit."

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News: The muddy waters of Tata Steel sale

Tata Steel is considering selling off some of its UK assets separately according to reports in a national newspaper.

The Indian-owned steelmaker concluded that it is exploring all options for portfolio restructuring including the potential sale of Tata Steel UK, in whole or in parts. The formal process began on April 11 with contact made with 190 potential financial and industrial investors worldwide.

Seven suitors made it through to the next stage but some believe that Tata may even stay in the UK and keep some of its assets, especially as the Government examines pension liabilities and offers financial support. Port Talbot has been turned around since the much publicised £1m a day losses.

Now the Financial Times reports that despite having rejected bids from investors seeking to cherry-pick parts of the operation, Tata now seems open to selling off individual units of the UK business.

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Not a great prospect for the blast furnace at Port Talbot, it would make sense for the standalone Speciality Steels business in South Yorkshire. Tata Steel Europe's only Electric Arc Furnace based business produces around 225,000 tonnes of steel with a £275m turnover. Until recently it employed over 2,000 people at sites like Aldwarke and Stocksbridge. It is not considered a downstream business linked to Port Talbot and Tata Steel's strip products.

When asked about the Port Talbot works and selling off separate parts of the UK business by the BIS Committee in April, Bimlendra Jha, CEO of Tata Steel UK, said: "We have to find a solution to the whole. In finding that solution for the whole, if there are some very small parts, and independent parts, we can deal with it. But we would not deal with it that somebody says: "Leave alone Port Talbot and give us the rest," that's not a solution that is acceptable."

The FT states that: "The Government and Tata privately agree that the strongest candidates are JSW Steel of India and a joint bid between Endless, a UK private equity fund, and Wilbur Ross, a veteran US turnround investor, because of their financial positions."

It adds that Albion Steel, a new vehicle led by former Corus CEO, Tony Pedder, is lining up behind JSW with a view to acquiring Tata's specialist steels division in South Yorkshire.

As bidding opened, a spokesperson for Albion Steel said: "This opportunity is a complex one which has best prospect of successful execution if Tata is prepared to approach its disposal plans in a different way and to engage strategically with Albion and other interested parties to seek a negotiated structure."

The sale of Tata Steel's Long Products division to Greybull took two years and, whilst timescales for the sale of the remaining assets have not been given, the company has stressed the sense of urgency in order to remove uncertainty for employees, suppliers, customers and shareholders.

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News: Albion Steel's reported interest in Tata's Speciality Steel business

A national newspaper is reporting that a group of experienced professionals from the region's steel industry are the latest to show an interest in the South Yorkshire operations of Tata Steel.

The Indian-owned steelmaker recently concluded that it is exploring all options for portfolio restructuring including the potential sale of Tata Steel UK, in whole or in parts. The formal process began on April 11 with contact made with 190 potential financial and industrial investors worldwide.

Sites in Rotherham and Stocksbridge are part of Tata Steel's Speciality Steels business that produces around 225,000 tonnes of steel, comprising around 3% of Tata Steel Europe's total output. It has a £275m of turnover and is Tata Steel Europe's only Electric Arc Furnace (EAF) based business, specialising in carbon, alloy and stainless steels for demanding applications like aerospace, motorsports and oil and gas.

A report in the Financial Times states that Albion Steel is examining a possible takeover and "envisages investment of £200m to introduce new technology for producing strip steel and changes in the way the assets are used."

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Albion Steel hit the headlines last year when it was reported that it has been studying the feasibility of building the first carbon steel plant in the country for forty years.

A brownfield site in Sheffield was identified for a facility employing 200 people that would use newly-developed direct casting technology to supply flat products based on scrap-fed mini-mill production.

Investors were being targeted for the operation but the FT states that Albion Steel "is now looking at information from Tata to assess the viability of its restructuring plan and is also understood to be actively speaking with a range of possible funding sources."

Albion Steel is led by co-founders Dr Rod Beddows and Tony Pedder OBE.

A former Master Cutler and current chairman at Sheffield Forgemasters, Tony Pedder joined British Steel Corporation in 1972 and came to Sheffield in 1986 as chief executive of British Steel's Stainless Division (now Outokumpu). He was on the main board in 1999 when British Steel merged with Dutch steelmaker Hoogovens, creating Corus plc, of which he became group chief executive in 2001.

Dr. Rod Beddows is a strategy consultant who advised Tata Steel on the acquisition of Corus to create the world's fifth largest steel company in 2006.

A spokesperson from Albion Steel Ltd, said: "Albion Steel Limited was established to bring new steel manufacturing technology to the UK and is in the process of developing its business plan, locating a potential site and securing further investment.

"The recent Tata problems highlighted an unexpected opportunity to combine the Albion concept with the Tata Steel Speciality Steels business in an innovative structure which may potentially include other metals producers in the region.

"This opportunity is a complex one which has best prospect of successful execution if Tata is prepared to approach its disposal plans in a different way and to engage strategically with Albion and other interested parties to seek a negotiated structure."

Tata Steel reiterated its policy last week that it was not naming, confirming or commenting on any potentially interested investor or bidder.

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