British Steel has agreed a takeover deal with Chinese firm Jingye in a move which could save up to 4,000 jobs.
The Official Receiver confirmed this week that it has accepted a bid from the Chinese conglomerate for the firm’s Scunthorpe plant and other international operations for a reported £50 million.
Chairman Li Ganpo said he was keen to safeguard as much of the business as possible.
“This is the beginning of a long journey. We know that this is only the start of the hard work of revitalizing British Steel,” he said.
“But we believe that this combination will create a powerful, profitable and sustainable business that will ensure the long-term future of thousands of jobs while producing the innovative high-quality steel products that the world needs.”
Mr Ganpo added that Jingye – which employs around 23,500 people worldwide – is planning to invest £1.2 billion into the firm to upgrade efficiency and lower carbon emissions.
Commenting on the deal, the Official Receiver said: “This is an important step towards securing steel making operations at British Steel’s sites in the UK.
“The government continues to work with the Official Receiver and Jingye on the next stage of the sales process.”
The news comes after British Steel fell into administration in May after the firm failed to turn a profit, risking thousands of home-grown jobs.
Welcoming the announcement, Roy Rickhuss, general secretary of steelworkers’ trade union Community, said: “Whatever government is in place in the coming weeks it is vital that all steps are taken to successfully conclude this process – everyone needs to remain focused on achieving that outcome to save our steel.”