British Steel enters liquidation

The move follows days of speculation about the future of the business which culminated in a breakdown of rescue talks between the government and the company’s owner, Greybull.

The Government’s Official Receiver has now taken control of the company as part of the liquidation process and accountancy firm EY has taken on the role of Special Manager, assisting the Receiver.

They said the company will continue to trade as normal as they begin a looking for a buyer for the business.

British Steel has about 5,000 employees. There are 3,000 at Scunthorpe, with another 800 on Teesside and in north-eastern England and the business affects 20,000 jobs in its supply chain.

Other employees are located in France, the Netherlands and various sales offices round the world.

The Official Receiver said British Steel Ltd had been wound up in the High Court. It said the immediate priority was to continue safe operation of the site.

“I appreciate that this is a difficult time for the company’s employees and I want to thank them for their ongoing co-operation,” the Receiver said.

“The company in liquidation is continuing to trade and supply its customers while I consider options for the business.

“Staff have been paid and will continue to be employed.”

EY said the appointment of the Official Receiver followed “a number of weeks” of negotiations by management with the company’s various stakeholders, including lenders, shareholders and the government, to secure the necessary funding to avoid an insolvency.

“Regrettably, these efforts were unable to secure a solution before the company’s funding resources were exhausted.”

The other companies within the British Steel group are continuing to trade as normal and are not in insolvency.