Tata Steel is likely to exit from its United Kingdom (UK) steel business soon, as per a report. Owing to alleged little or absence of government support, Tatas may soon exit from that market, The Economic Times reported.
Tata Steel may exit UK steel business as there is little hope of a £1.5 billion subsidy package for the proposed transition to green energy as given by the Liz Truss government, The Economic Times reported citing people familiar with the matter.
The report even adds that Tata Sons has said that the mentioned funding is needed in order to replace carbon-intensive blast furnaces with electric arc furnaces. This would also be done over the next few years to keep the plant properly operational. Hence, a person familiar with the matter reportedly said that the company was not keen on waiting endlessly for this confirmation from the UK government.
“Exiting businesses which are also supporting local communities have never been our group philosophy, but it has to be acknowledged and supported by the government too” an executive familiar with the development told ET.
All these developments come sometime after Tata Sons’ repeated discussions with the UK government as reportedly, if there is no support, they may be left with just one option of exiting the market/business.
At present, Tata Steel is looking for support for its UK business in two ways, as per the ET report. The company primarily wants the UK government to give a policy support by encouraging transition to green steel and ensuring cost-competitive landscape. Along with this, it even wants UK government’s support through partnership in financing of the project. Outlook Business could not independently verify these details.