Tata Steel is working on the sale of its Long Products Europe business and associated distribution activities, it tells Kallanish. “We have […] decided to concentrate our resources mainly on our strip products activities, where we have greater cross-European production and technological synergies,” explains Karl Koehler, ceo of Tata Steel’s European operations.

Tata has announced the signing of a memorandum of understanding with Klesch Group to undertake detailed due diligence and negotiations for the potential sale of several UK-based assets, including Tata Steel’s Scunthorpe steelworks, mills in Teesside, Dalzell and Clydebridge in Scotland, an engineering workshop in Workington and a rail consultancy in York. The memorandum also covers other operations in France and Germany, Tata says in a press release.

These businesses employ about 6,500 people, a sizeable chunk of Tata Steel’s European workforce of 30,500, which includes 17,500 in the UK.

The Klesch Group, based in Geneva, Switzerland, describes itself as a global industrial commodities business, with three divisions specialising in the production and trading of chemicals, metals and oil. Founded in 1990, “we have revenue in excess of €5 billion, and employ more than 2,000 people across 30 locations in over 17 countries around the world,” it says.

According to Tata’s Koehler, “we will now move into detailed due diligence and negotiations, though no assurance can be given about the outcome. We will regularly engage with our employees and other stakeholders throughout this process, and we will consult with the trade union representatives and works councils.”

“We’ve improved the competitiveness of Tata Steel’s European operations, including Long Products Europe which now supplies more of the innovative steel rail, rod, plate, sections and special profile products demanded by customers,” he adds.

 “We want to build a sustainable business in the UK and further develop our mainland Europe business and we are committed to providing the necessary leadership and financial resources to achieve that.”