Tata Steel’s UK arm to sell two pipe mills to Liberty House Group
Mumbai: Tata Steel Ltd on Tuesday said its UK subsidiary had signed a definitive agreement to sell two pipe mills in Hartlepool, England to Liberty House Group.
The two mills, which make 42 and 84-inch pipes, source their raw material from outside Tata Steel and hence, are independent of the company’s product supply, the company said in an exchange filing.
“With this sale, Tata Steel UK will complete its portfolio restructuring to focus on the strips products supply chain linked to Port Talbot (plant in Wales). The sale is also an important step towards developing a more sustainable future for the rest of our UK business,” Bimlendra Jha, CEO, Tata Steel UK, said.
The sale of the Hartlepool pipe mills is part of Tata Steel’s efforts to restructure its European business following impairments of over $5 billion over the last few years. The company first acknowledged in March 2016 that it was exploring strategic alternatives for its UK business and was open to selling the business as a whole or in parts.
“In the wider interest and financial sustenance of the Tata Steel Group, the board also reviewed the UK business in its entirety and advised its European subsidiary—Tata Steel Europe—to look at all options of restructuring including a potential divestment of the whole or parts of the business,” Cyrus Mistry, Tata Steel’s chairman at the time, had observed in its annual report.
In May 2016, TSUK sold its Long Products Europe business to Greybull Capital. Earlier this year, it sold its Speciality Steels business to Liberty House Group for £100 million. It has also been in talks with Germany’s Thyssenkrupp since July 2016 about the feasibility of a potential joint venture.
Negotiations between the two are said to have been hampered by Brexit and concerns over Tata Steel’s issues with the UK pension regulator.
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