Dalzell steelworks up for sale

Tata Steel is set to pull out of Motherwell
Tata Steel is set to pull out of Motherwell

Tata Steel has announced plans to sell off it’s Long Products Europe division which includes the Dalzell plate mill in Motherwell.

The Indian firm has signed a Memorandum of Understanding with the Swiss-based Klesch Group to undertake detailed due diligence and negotiations.

As well as Dalzell the proposed deal will also include the Scunthorpe steelworks, mills in Teesside and Clydebridge at Cambuslang, an engineering workshop in Workington and a rail consultancy in York, as well as other operations in France and Germany.

Karl Koehler, chief executive of Tata Steel’s European operations, said: “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 are making huge strides on our strategic journey to become a premium, customer-centred steel company thanks to investment in equipment, technology and customers, together with the substantial contributions from our employees.

“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.

“Accelerating the pace of innovation on advanced steel solutions, helping our customers succeed in their markets and creating a sustainable asset base requires significant capital and expertise.

“We have therefore decided to concentrate our resources mainly on our strip products activities, where we have greater cross-European production and technological synergies.

“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.”

The Times & Speaker understands trade unions were left in the dark that Tata was looking to sell the division.

Roy Rickhuss, general secretary of Community and chairman of the trade union steel committee said: “We’re extremely disappointed with the way that Tata Steel have handled this announcement, which does not reflect well on Tata’s values.

“However, I am pleased they have now agreed to meet the unions and I hope this can take place soon so that we can start to address the understandable worries and concerns of our members, their families and communities.”