The world’s sixth largest steelmaker Tata Steel on Friday announced an investment of Rs2,920 crore (£400 million) over the next five years, in its bid to turnaround its bleeding long product division in Europe.
The steelmaker would also close down some of its plants in Europe putting at risk around 1,500 jobs.
Earlier this year, Tata had sold part of its Teesside Cast Product division in Europe to Thailand’s largest steel producer Sahaviriya Steel Industries for $469 million (Rs2,110 crore).
“We are proposing to take these actions only after going through an inclusive consultative process that involved very careful scrutiny of the long products business performance,” said Karl-Ulrich Kohler, managing director and CEO, Tata Steel Europe. “We have used the experience we gained in turning around our speciality steels business in developing this strategy for the rest of long products and we are convinced it represents the best chance of making this business successful and sustainable in the long term.”
The company’s long product division in Europe have continued to make losses for the firm in the last two years led largely by a decline in construction activity in some of its major markets.
The jobs at risk are mostly in operational, functional and management positions. Tata would begin consultation process with employees and union members.