New twist as Tata to sell two Midland specialists
TATA Steel has announced plans to offload two of its companies in the Black Country. Following “a detailed review” of all its companies to assess their future potential, the global group’s European arm wants to sell five separate businesses which supply products to niche markets, allowing the wider company to continue its focus on strategic strip products and markets.
The sale includes Walsall-based Firsteel, which coats steel for kitchen bakeware, and the Engineering Steels Service Centre in Wolverhampton which is a stockholder and processes engineering steels.
The other companies up for sale are Cogent, a manufacturer and processor of electrical steels based in South Wales, Canada and Sweden, aluminium roofing and cladding business Kalzip in Germany and coil coating company Istanbul Metals in Turkey.
Firsteel has 50 staff and Engineering Steels Service Centre 20 while collectively, the five business units employ 1,100 people.
This is the latest twist in the recent history of Tata Steel Europe after it launched a bid in early 2016 to offload its UK arm which was said to be losing £1 million a day following a collapse in the price of steel products coupled with high energy costs and the affect of climate change policies.
Various deals were signed including a £100 million buyout in February 2017 by Liberty House group of Tata Steel’s speciality steels division, comprising sites in Wednesbury, Bolton, South Yorkshire and China.
Tata Steel Europe is part of Tata Group, the India-based global conglomerate which owns luxury car manufacturer Jaguar Land Rover and tea brand Tetley among many other brands.
Hans Fischer, chief executive of Tata Steel’s European operations, said: “These potential sales follow the successful sale of other non-core businesses in recent years, such as Long Products Europe and Speciality Steels.
“Under new ownership, these former Tata Steel businesses have found the focus to secure a more sustainable future.
“In turn, these divestments have allowed us to focus resources on making significant improvements to the core strip business as part of our ambition to develop the most sustainable steel business in Europe.
“The customer bases for the businesses being sold are distinct from the rest of Tata Steel Europe.
“We want to find the best owner for each of these business units who can focus on their needs to help them realise their full potential.
“These potential sales would enable Tata Steel Europe to focus investment and management resource on its core strip products business and strategic markets.”