Turkey’s military pension fund in exclusive rescue talks to take over British Steel

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Turkey's military pension fund in rescue talks to take over British Steel

British Steel: provisional deal with Turkish bidder could save 4,000 jobs

Full transfer of ownership to pension fund Oyak expected to take place before end of year

Ataer, a unit of Oyak which looks after the pension pots of Turkey’s military personnel, had entered into exclusive talks with advisers to the government who have been running the auction of the ailing steelmaker on behalf of the Official Receiver.

British Steel, whose largest manufacturing site is in Scunthorpe, collapsed into insolvency in May after the government chose not to give £30m to the company under its then-owner, Greybull Capital.

The Turkish military pension fund Oyak has confirmed that it has reached a provisional deal to buy British Steel, in a rescue that could save 4,000 jobs.

Oyak on Friday said its subsidiary, Ataer Holding, will have exclusive rights to carry out due diligence on British Steel for two months, Reuters reported.

The buyer expects to complete due diligence by October, with a full transfer of ownership to take place before the end of the year.

The majority of the more than 4,000 employees are based at British Steel’s Scunthorpe blast furnace. However, so far Oyak has not revealed details of its plans.

In a statement Ataer Holding said it was now exclusively conducting a detailed financial, legal and operational review for a period of two months.

It said: “During the exclusivity period, close negotiations to be held with customers, suppliers, employees and trade unions is significant for the future success of British Steel.”

OYAK General Manager Suleyman Savas Erdem said: “We have achieved one of the biggest achievements of the Turkish steel industry and signed a preliminary agreement to buy the industrial giant of UK, British Steel.

“We will continue to evaluate opportunities globally inline with our growth-oriented vision and we will continue our investments to provide sustainable high benefit to our members.”

Around 3,000 people are employed at Scunthorpe, with more than 1,000 employees elsewhere in British Steel and an estimated 20,000 in its supply chain.

Since its collapse into liquidation, British Steel ‎has been funded through a taxpayer-backed indemnity and is estimated to be losing around £5m a week.

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