The Greybull Capital has told on April 11th that it has cemented an investment deal with Tata Steel Europe for its loss making three units in Scunthorpe. Greybull has planned to invest 400 million pounds in the company whereas the Tata Steel Company has told that it will get nominal consideration from the deal which is made. The Assets and Liabilities of the company will be taken over by Greybull, which was said by Tata Steel.
The deal will not reduce Tata Steel’s USD 700 million debt, but instead it will put a stop loss and the deal will remove USD 1000 million dollar loss that the company which has been reeling under. The UK government is worried about the welfare of 4500 workforce that the plants had. The Labour MP of Scunthorpe Nic Dakin has told that the company needs complete restructuring for the work force.
The Tata Steel Union head Matt Ball has stated that the pension liability discussion is still under process and once the deal is completed the new pension plan will come into existence.
The Associate Director of S&P, Vishal Kulkarni has said that the rating improvement for the company is still three to four quarters away. He has further added that getting rid of loss making assets is not enough for the company’s development and Greybull has support from the government to take the workforce forward.
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