UK's second-largest steel producer starts bankruptcy

publisher: Gloria Wong
Time: 2019-05-30
Summary: Britain's second-largest steel producer, British Steel, announced on the 22nd that it would start bankruptcy proceedings and be taken over by the government's official receiver.

According to the National Iron and Steel Company, theuncertainty of the UK's “Brexit” has led to a significant reduction in itsEuropean customer orders, coupled with the weakness of the pound and theaddition of steel tariffs in the United States, the company has long faced afinancial crisis. Although the British Ministry of Commerce, Energy andIndustry officials said in the parliament on the 21st that the government willdo everything in its power to support the steel industry, but the British steelcompany shareholders and the government still failed to reach a loan agreementin the afternoon deadline.

In April of this year, the British steel company received aloan of 100 million pounds (1 pound or 8.74 yuan) to pay the EU carbon bills,thus avoiding high fines. The company initially filed a £75 million loanapplication with the government, and its shareholders agreed to increasecapital to reduce its loan demand to £30 million.

Since the 1950s, the UK has gradually become the world'ssteel center. The steel industry was once an important contributor to theBritish economy. In the early 1970s, during the peak production period, the UKsteel industry employed as much as 320,000. The latest data shows that thecurrent UK steel output only accounts for 0.1% of its gross domestic product(GDP). Several British steel mills owned by Tata Steel, Britain's largest steelcompany, are also facing severe conditions.

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