British Steel collapses putting 25,000 jobs at risk
The UK’s second largest steel producer collapsed into insolvency after it failed to secure emergency funding from the government putting thousands of jobs at risk.
![British Steel](http://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/news-article-image-folder/bg_trader_359480658.jpg.jpg/jcr:content/renditions/original-size.webp)
British Steel went into administration on Wednesday, putting 5,000 direct jobs at risk and endangered another 20,000 in the supply chain.
The steel producer collapsed after it failed to secure emergency funding after rescue talks held between the UK government and the company’s owner Greybull Capital broke down.
Hunt for British Steel buyer begins
The Government’s Official Receiver, which will handle the liquidation process of British Steel, has taken control of the company and the hunt for a suitable buyer to acquire the steel producer has begun.
Despite the government being open to new buyers, the opposition Labour Party has called for British Steel to be brought under public ownership and renationalised.
For the time being, the company will continue to trade as normal and staff will remain employed by British Steel, with the majority based in Scunthorpe.
Greybull Capital fail to save British Steel
British Steel’s owner Greybull Capital specialises in turning around distressed businesses, but was forced to admit defeat on this occasion, blaming its failure on the challenges created by Brexit.
The investment company famously acquired British Steel from its previous owner Tata Steel for just £1 three years ago.
Greybull Capital was able to generate a profit at the ailing steel producer in 2017 but was forced to cut 400 jobs last year in a bid to save the company as it struggled to deal with a weakening pound and increased Brexit uncertainty that hurt demand.
‘In light of events over the past few weeks, it is clear Greybull needs to do the right thing by getting out of the road and let those who are committed to our industry work to save the business,’ the union Community said in a statement.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
![](http://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/Rebrand/Article_banners/European-central-bank-banner.jpg/jcr:content/renditions/original-size.webp)
European Central Bank meeting
Learn about how the ECB meeting affects interest rates and price stability ahead of the next announcement.
- How might the next meeting affect the markets?
- What are the key rate decisions to watch?
- Why is the Governing Council announcement important for traders?
Live prices on most popular markets
- Forex
- Shares
- Indices
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.