Sunday 10 November 2019 3:03 pm

China's Jingye Group poised for British Steel takeover deal

Chinese firm Jingye is set to agree a deal to buy British Steel tomorrow, in a move that is hoped to save more than 4,000 jobs at the company’s flagship plant in Scunthorpe.

Advisers have been working on a draft agreement in recent days. Jingye is thought to be gearing up to pay a figure in the region of £70m, according to reports.

Read more: Chinese steel maker Jingye in new bid for British Steel

Jingye will also be able to use a £300m taxpayer-funded support package, according to the Sunday Telegraph.

British Steel employs around 5,000 people in the UK, and supports about 20,000 further jobs in the supply chain. It is one of Network Rail’s main suppliers.

Jingye reentered the fray as a bidder for the company when negotiations with Ataer Holding, an investment arm of the Turkish military’s pension fund, did not come to fruition during a period of exclusivity with the Official Receiver, which is managing the negotiations.

The Chinese firm striking a deal would end months of uncertainty for British Steel workers, who have been in limbo since the firm went into administration in May.

Any agreement tomorrow would be followed by weeks of further negotiations, with no guarantee a final deal would be reached.

Labour’s shadow steel minister Gill Furniss said: “At this moment in time the workforce needs some reassurance.”

Read more: Questions linger as Turkish military pension fund swoops in on British Steel

Jingye Group is chaired by businessman Li Ganpo, one of the richest men in China.

Ganpo and a group executives arrived in the North of England two weeks ago for a tour of the company’s flagship Scunthorpe plant and its factory on Teesside.

Jingye was not available for comment.