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Will Brexit hit Tata Steel UK sale?

business Updated: May 30, 2016 07:05 IST

LONDON: If Britain votes to leave the European Union in the June 23 referendum, it could “scupper” the sale of Tata Steel’s UK assets, according to Carwyn Jones, First Minister of Wales, who last week returned after meeting top officials of the company in Mumbai.

June 23 is also the date when the consultation on making changes to the British Steel Pension Scheme ends. Burdened with a deficit of £700 million (Rs6,800 crore), the scheme is seen as a major deterrent to potential buyers.

Jones, who attended the Mumbai talks with business secretary Sajid Javid, told Sky News on Sunday that there were seven bidders, but no one would want to buy the plants if the pension fund was still there.

He said the outcome of the EU referendum had the potential to “scupper” a sale, saying “all these buyers are holding off to see what the result is on the 23rd of June and I’ve no doubt they’ll run if they find the UK has left”.

Sky News also reported that the £400 million (around Rs 4,000 crore) sale of Tata Steel’s longproducts division to Greybull Capital, which was announced in April, is likely to be completed next week. After completion, the division with 4,800 workers based mostly in Scunthorpe would be named British Steel, it said.

First Published: May 30, 2016 07:05 IST