£30m res­cue pack­age for steel firm

The Daily Telegraph - Business - - Front Page - By

Alan Tovey

STEEL com­pany Celsa has been granted an emer­gency loan by the Gov­ern­ment in what is be­lieved to be the first deal un­der the “Project Birch” pro­gramme to sup­port strate­gi­cally im­por­tant busi­nesses.

Celsa, which has 1,600 staff in the UK and is the coun­try’s big­gest man­u­fac­turer of steel used to re­in­force con­crete for the con­struc­tion in­dus­try, has re­ceived a £30m bail-out.

It is un­der­stood that while the fund­ing comes as a loan, its terms could see the tax­payer take a stake in the busi­ness if it is not paid back, although the Gov­ern­ment said it “ex­pected to be re­paid in full”.

De­tails of the res­cue were not re­vealed, but the Gov­ern­ment said it in­cluded com­mit­ments re­lat­ing to pro­tect­ing jobs, en­vi­ron­men­tal tar­gets, and “re­straints” on ex­ec­u­tive pay.

Ex­ist­ing len­ders and share­hold­ers also had to put in ex­tra fund­ing.

Jaguar Land Rover and Tata Steel also seek­ing tax­payer sup­port. The Busi­ness Depart­ment said the Celsa agree­ment was made in “ex­cep­tional cir­cum­stances”, adding there was a “high bar for putting tax­pay­ers’ money at risk in this way” which was “an ab­so­lute last re­sort”.

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