Chinese Jingye acquires British Steel

Jingye Group, a private Chinese steelmaker, has completed its acquisitions of British Steel's assets in the UK and the Netherlands from British Steel's official successor and will expand the company's steelmaking capacity by moving to a steelmaking electric arc furnace at Teesside, Jingye announced on Monday.

Jingye said in a statement that it will also build a new rebar line, improve the existing railway station and invest in British Steel rolling mills to produce high quality steel products to optimize its range.

According to the Chinese company, Jingye's pledge to invest £ 1.2 billion ($ 1.58 billion) to put British Steel's business on a more competitive and sustainable footing is aimed at bringing the company back with a comparable industry margin within five years. British Steel is currently a major rail producer and is expected to benefit from the UK government's decision to continue with the UK's HS2 high speed rail project.

Jingye will also build a new 250 MW power plant to service the Scunthorpe site, where British Steel operates four blast furnaces, two of which are currently in operation.

According to the press secretary, it is currently planned to restart the third blast furnace while the second is closed, so the two blast furnaces will continue to operate.

The new power plant is expected to be about a third more efficient than the one it will replace.

Job loss, government support

Although official figures for British Steel job losses were not announced in Jingye's statement on Monday, UK-based GMB called them “heartbreaking,” while Jingye Group CEO Lee Huimin also commented on the difficult negotiations that preceded Monday's conclusion.

“It has not been an easy journey since we first announced our intentions in November, but the longer I have spent in Scunthorpe, the more I begin to believe in the successful future of these smelters and the employees who have made them famous around the world,” said Huiming. "Together we can create a new partnership that will usher in a glorious new chapter in the history of British steel making."

Business Minister Sharma added that he wanted to "reassure British Steel employees who may be facing a redundancy problem that we will mobilize all available resources to provide immediate support and advice to those affected."

Charlotte Childs, a member of the GMB union, said in a statement: “This deal is worth it to protect British steel for future generations. But in order to