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Investors in the British Steel French plant are waiting anxiously to see if the sale to a Belgian investor is still on track.
At a meeting on Wednesday night between British, German and French ministers, the potential sale of the Kurla steel plant, which employs about 9,000 people, was criticised as “not enough”, and to meet conditions of the deal was expected to take longer than expected.
“We have said that we need to have a good deal. This is already to be better than that [the current deal],” British Trade Secretary Liam Fox said.
Officials put a date of April 1 to buy the plant, but the bidder, DLV, has warned investors that it still needs to secure more state help than the current offer of £15m.
UK company Tata Steel bought the plant in 2002 and announced its intention to sell the site as part of plans to refocus its UK operations in the aftermath of last year’s Brexit vote.
Analysts in the UK had expected German investors to snap up the site, which makes parts for steelmakers in Europe and US, and contribute steel to the German carmakers’ new generation of production processes.
As part of talks last year the British government agreed to help Chinese and Russian steelmakers when they compete directly with the UK steel market.
Viktoria Liljedahl, chairwoman of DLV, the company leading the bid, told the FT on Friday that the government had remained “on track” to sign off on the sale, but that it would take at least four to six weeks longer than previously expected to conclude.
Vincenzo Torlaggi, the French minister responsible for industrial policy, called the negotiations “a bit slow” and said that at a meeting on Wednesday it was agreed that the forthcoming sale deal would be delayed by at least four to six weeks.
“The deal is being reviewed and in that review, you need to draw conclusions,” he told reporters. “For this reason the parties spoke and concluded to share this responsibility to make a good deal on the grounds for the future of the plant, its workers and customers.”
Ms Liljedahl and French industry minister Christophe Sirugue said that the sale was not over.
DLV is now trying to secure additional financing, which is likely to involve a loan from the European Investment Bank. The EIB recently approved around €300m of loans for UK-based projects, including a £3.9bn agreement with Samsung Heavy Industries to build three new aircraft carriers in South Korea.
Foreign investors may be attracted to the Kurla steel plant because of its location, near the French border with Germany, and the fact that German state subsidies do not apply to a state-owned entity.
Ms Liljedahl pointed out that talks had been “good” and that the French state remained convinced of the deal’s “agreed path”.