Daily Mirror (Northern Ireland)
British Steel fired up for expansion Firm shows its mettle in £600m growth plan
BRITISH Steel has earmarked up to £600million of possible expansion – despite Brexit and a transatlantic trade war.
The business, which struggled under previous owner Tata Steel, yesterday announced its biggest manufacturing investment for a decade.
Some £50m will be spent upgrading one of two mills at its Scunthorpe steelworks, plus £40m of other planned investment by next June.
It is also looking at £500m of further potential projects over the next five years to attract new customers.
It came as British Steel, bought for just £1 by private equity firm Greybull Capital in 2016, announced profits rose from £47m to £68m in the year to March.
That doesn’t include £47m of costs from the temporary halting of production at a blast furnace which it has made an insurance claim on.
Profits hit £21m in the three months to the end of June. British Steel chairman Roland Junck said: “Our transformation remains firmly on track.” The firm has borrowed an extra £90m from a US lender called White Oak Asset Finance to help fund its expansion.
Bosses admitted it had a “higher-risk profile”, suggesting it may be costlier than normal.
The investment comes in spite of Brexit uncertainties, but Paul Martin, British Steel’s deputy chief executive, insisted: “We can’t become paralysed by what might happen.”
He said another dispute – US President Donald Trump’s tariffs on steel imports – was having an impact.
The European Commission hit back yesterday with 25% tariffs on unusually high levels of steel imports.
It comes amid fears that America’s clampdown will see Chinese and other foreign steelmakers “dumping” its cheap steel in Europe, which will hammer producers.