British Steel May get £500 Million Taxpayer Support

(Bloomberg) -- British Steel may secure a taxpayer support package of as much as £500 million ($620 million) to secure the future of its plant in Scunthorpe, the Financial Times reported, citing an unnamed government officials.

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The government had offered British Steel owner Jingye Group about £300 million, but the Chinese firm wanted an amount closer to the £500 million secured in September by rival Tata Steel, the paper said, citing two officials. One told the paper that sum looked like a “landing zone,” it reported.

Jingye is working on a restructuring plan for its operations, including deciding the fate of its 4,000 workers, according to the FT.

One UK government official called the report speculative and said nothing had been decided or agreed.

“Our commitment to the UK steel sector is clear, and we continue to work closely with industry, including British Steel, to secure a sustainable and competitive future for the sector and its workers,” the UK government said in a statement. “Ultimately, it’s for British Steel to manage commercial decisions for the future of the company.”

British Steel, for its part, said it’s committed to turning the company into a “green and sustainable company providing long-term, skilled and well-paid careers for thousands of employees and many more in our supply chains.”

“As part of our journey to net zero, it is prudent to evaluate different operational scenarios to help us achieve our ambitious goals and we are continuing to assess our options,” the company said.

--With assistance from Eddie Spence.

(Updates with British Steel comment in final two paragraphs.)

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