Tata Steel set to sell its loss-making European long products business
09 Nov 2015
Forced to go for more restructuring of its UK business due to a ''challenging marketplace'', Tata Steel will sell its Long Products Europe business by the end of 2015-16.
The business manufactures plates, sections, wire rod and semi-finished steel for different markets, including construction, ship-building and engineering, energy and wire drawers. These products are made at its mills in Teesside and Scunthorpe in the UK.
When asked, Tata Steel Europe chief executive Karl Koehler last week said, ''Our stated strategy stays unchanged. Long products will not have a future within Tata Steel. And that means we will come to one of the possible options which I don't need to spell out and decisions about that have to happen within the timeframe of this financial year, to say the very least.''
The steel maker, which reported Rs16,948-crore turnover from Europe in the September quarter, said a ''sharp deterioration'' in market conditions impacted performance in the UK with an earnings before interest, tax, depreciation and amortisation loss of Rs238 crore.
In August, the firm had said talks with Switzerland-based Klesch Group for sale of its long products Europe business had been discontinued. The firm had been in talks with Klesch following signing of a deal in October 2014.
Tata Steel has already made three restructuring announcements of its business in the UK since July this year.
"In response to the above market and business conditions in the UK, the company continues to restructure its UK business and has recently announced the closure of some of the sites in the UK," the firm said.