All that you need to know about Tata’s plans to sell its steel plants in the UK

Cyber Journal 24, March 31, 2016

By Nitten Gokhaley 

Tata group is deeply concerned about the performance of its British subsidiary according to BBC’s report.  In order to protect its financial position, the group is looking for possible buyers who could buy their assets located in various parts of the UK. 


The UK arm is losing around $1.5 million each day as per information shared by people who are following this story. During the last five years, Tata has probably lost around $3 billion because of its British operations. So, the group plans to sell-off this arm. The deal is expected to impact 15,000 jobs, plus, another 15,000 individuals involved in supply chain would have to start searching for new job.

Wales is home to the company’s biggest steel plant and the community in that part of the UK has not been able to digest this news about Tata’s exit. They are shocked, disappointed, and under fear about their economy.

Politicians urging PM David Cameron to act urgently

Tata Steel has almost sealed deal for its Scotland based plant.  Some companies are interested in buying certain assets from Tata’s Port Talbot plant. But unfortunately, companies are willing to buy assets that employ lesser number of workers.

Government support for management buyout may not prove to be feasible as the cost may go into billions. This move may also prove to be against European Union state aid rules. Part or complete nationalization of these assets is being discussed on political level.

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Leader of Opposition, MP Jeremy Corbyn

MP Jeremy Corbyn visited the constituency that is home to Tata’s biggest plant today and made a statement that the plant needs to be taken into state ownership if required. He also wrote a letter to PM urging him to urgently look into this matter.

Story published by the Guardian suggests that MP for Aberavon, Stephen Kinnock and some union leaders went to Mumbai to meet Chief Financial officer for Tata group. They urged the group to create turnaround plan and continue making steel at Port Talbot as well as other plants in the UK.

Chinese steel exports are hampering steel makers from around the world

Experts pointed out that this is a global story and decisions are coming from other side of the world. Cheap exports from China are causing shock-waves in global steel industry. What is happening in the UK steel industry is just one of the symptoms of these shock-waves.

Until last decade, steel makers use to make $225 per ton, but last year, this figure crashed to $120 per ton. Oversupply led to lesser demand in the market.

Situation is changing. If you look at this year’s figures, you would find that steel prices have jumped around 40 percent compared to last year. Profit margins are rising according to business analysts. Shares of steel manufacturing companies are up by as much as 50 percent compared to last year’s numbers. But after racking up big losses, the Tata group seems to have made its mind to exit.


Nitten is a consultant journalist, and has worked with renowned newspapers, news agency in India. If you are looking for desktop journalist, writer, you can email Nitten-

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