Jingye, the Chinese owner of British Steel, has asked the UK government for a £500 million rescue package to keep its steelworks in Lincolnshire open, with insiders claiming thousands of jobs will be lost if ministers reject the request. Jingye, which bought the country’s second-largest steelmaker out of insolvency in 2020, has told ministers that it requires financial assistance to keep its Scunthorpe operations viable.
According to the Financial Times, British Steel representatives have met with Business Secretary Jacob Rees-Mogg twice in the last two weeks to discuss the need for aid. The steel company employs approximately 4,000 people, most of whom work at Scunthorpe’s energy-intensive blast furnace. Thousands of additional jobs in the supply chain are also reliant on the company.
Jingye, which paid approximately £50 million in 2020, stated that it planned to invest £1.2 billion in the steelmaker over the next decade.
According to the UK business department, the government is working closely with the company to determine the best path forward as it seeks to secure a more sustainable future. “We recognise that businesses, particularly steel producers, are feeling the impact of high global energy prices,” it added, noting that the government has provided more than £780 million in assistance to the sector to help with electricity costs since 2013.