Tata Steel UK has signed an agreement to sell its Long Products Europe business to Greybull Capital. The sale, for a nominal consideration, would be in exchange for Greybull taking on relevant liabilities as well as assets, and securing an appropriate funding package.

The deal would be completed once a number of outstanding conditions have been resolved, including transfer of contracts, certain government approvals and the completion of financing arrangements.

The Long Products Europe business comprises the Scunthorpe integrated steelworks, Teesside Beam Mill in Lackenby, Special Profiles in Skinningrove, and Hayange Rail Mill in north-eastern France, among other units. It employs 4,400 people in the UK and 400 in France.

“This sale is the best possible outcome for employees who have worked relentlessly to ensure the business’s survival, and helped to make it attractive to a potential buyer,” Long Products Europe executive chairman Bimlendra Jha says in a statement seen by Kallanish.

Tata Steel UK has been in negotiations with Greybull Capital over the sale since the two firms signed a letter of intent in December (see Kallanish 23 December).

Tata Steel’s former Scottish mills in Dalzell and Clydebridge, also initially part of the negotiations, have since been bought by Liberty House.

Tata Steel Europe chief executive Hans Fischer says: “Under these current challenging market conditions in Europe with the soaring levels of imports from China, we are happy that Tata Steel UK and Greybull Capital have entered the final stage of completion of the sale of shareholding in Longs Steel UK. This transaction will offer a future for the Long Products Europe business.”

On Monday Tata Steel also commenced the formal process to sell its Tata Steel UK subsidiary (see related article).