CryptoFund Seeks Control of British Steel Producer

A Delaware-based investment firm, EIG Global Trust, is reportedly among a group of international suitors vying to acquire Speciality Steel UK, one of Britain’s largest steel manufacturers. This firm, which utilises investment strategies involving cryptocurrencies backed by stable assets such as gold or the US dollar, is currently in discussions to purchase the company from bankruptcy proceedings.

Speciality Steel UK ranks as the country’s third-largest steel producer and is recognised as the leading manufacturer of environmentally friendly steel. The company recently came under the control of the official receiver after being placed in compulsory liquidation by the High Court, a move initiated by its creditors due to substantial debts.

The list of potential buyers includes notable names such as 7 Steel, owned by Czech energy investor Pavel Tykac; Evore Steel from Canada; and Aperam, a Dutch firm. There is also reported interest from Arabian Gulf Steel Industries. As negotiations unfold, the outcomes for Speciality Steel remain uncertain.

Officials from the government are contemplating plans that might involve merging Speciality Steel with British Steel, another firm currently under state control. Such a merger could result in the closure of blast furnace production at British Steel, shifting capacity to Speciality Steel’s electric arc furnace in Rotherham. This scenario poses significant risks, including potential job losses estimated at around 2000.

The impending merger brings forth complex questions concerning the ability of Speciality Steel to meet production demands. The UK would also find itself as the last G7 nation lacking sovereign steelmaking capabilities, further complicating the economic landscape.

The government’s intervention in both companies has resulted in a precarious situation for British Steel. Despite retaining economic ownership, Jingye, the Chinese firm that acquired British Steel in 2020, is facing uncertainties since authorities are unable to sell the business while simultaneously covering substantial losses at the Scunthorpe site.

As discussions advance, the future of both firms hangs in the balance, with significant implications for the steel industry and its workforce across the UK.