Wednesbury steel jobs could be secured with government £350 million takeover
Potential acquisition follows unsuccessful private sector bid
The future of steel production in Wednesbury may be stabilised as the UK Government moves towards acquiring Speciality Steel UK in a deal valued at £350 million.
The government's decision comes after a private sector bid failed to secure backing for the steelworks, a vital employer in the West Midlands town alongside sites in South Yorkshire.
Business Secretary Jonathan Reynolds announced that the government is planning a “public acquisition” of Speciality Steel UK, having passed over a bid from Norwegian firm Blastr Green Steel earlier this year.
Reynolds highlighted the government’s concerns over the financial backing for the private bid, underlining the move’s aim to ensure local economic stability.
Blastr Green Steel expressed disappointment at the government's decision, noting that it was not informed in advance despite presenting a ready proposal reportedly costing British taxpayers nothing.
Recently, Speciality Steel UK came under the state’s Official Receiver's management due to a High Court ruling over liquidation.
Reynolds expects the acquisition process to span four to six months, integrating creditor payments, asset acquisition, and the injection of working capital up to three years. The total cost is estimated at £350 million.
The financial backing for this initiative is anticipated to come from Labour’s 2024 manifesto pledge, which allocates £2.5 billion for the steel industry, as much of this fund remains untouched.
Reynolds affirmed that the decision was practical rather than ideological, expressing hope for eventual private management.
Speciality Steel UK, employing about 1,300 staff across its Wednesbury, Stocksbridge, and Rotherham locations, has experienced furloughs and production pauses in recent months.
Trade unions have welcomed the government’s intervention in light of the strategic significance of the business to national supply chains.
Gareth Stace, director-general of UK Steel, praised the move as essential, while Community Union general secretary Roy Rickhuss recognized missed private acquisition opportunities but lauded government support.
First Secretary of State Louise Haigh underscored the government's role in safeguarding critical industries, emphasising:
“We will collaborate with regional and local partners to devise a strategy that benefits employees, the community, and the nation.”