Posted on 16 Apr 2025
British Steel has officially come under the control of the UK government after Parliament was recalled for a rare Saturday sitting on April 12 to pass the Steel Industry (Special Measures) Bill. The move effectively ends the five-year ownership of the company by China's privately-owned steelmaker Jingye Group and aims to keep British Steel's blast furnaces at Scunthorpe operational, Mysteel Global learned.
The legislation, which has received Royal Assent, allows the UK government to manage British Steel's operations without a full transfer of ownership - at least for now. Business and Trade Secretary Jonathan Reynolds told Parliament that the government had been negotiating in good faith with Jingye, offering a "generous" support package. "Despite our offer to Jingye being substantial, it wanted much more – an excessive amount, frankly," Reynolds said.
He revealed that the government had proposed buying the necessary raw materials to keep the furnaces running, but Jingye refused. "Its intention was to cancel and refuse to pay for existing orders... it would have irrevocably and unilaterally closed down primary steelmaking at British Steel," Reynolds stated. He added that Jingye even demanded "hundreds of millions of pounds" be transferred without safeguards to prevent the funds from being shifted to China.
The government's intervention came amid stalled progress in a £1 billion decarbonisation plan announced last November, which would see the replacement of blast furnaces with electric arc furnaces. Unions and industry leaders welcomed the move, calling it vital to preserve jobs and prevent long-term damage. "If the fires go out, it is nigh on impossible for (blast furnaces) to be brought back to life," UK Steel Director General Gareth Stace said.
In response to this matter at a press briefing on April 14, Chinese Foreign Ministry spokesperson Lin Jian pointed out that Jingye is a private company operating under market principles. He urged the UK to "treat Chinese enterprises fairly, protect their lawful rights and interests, and avoid politicizing economic cooperation or overstretching the concept of national security."
Despite the government's takeover, Parliamentary Under-Secretary of State Baroness Jones of Whitchurch stressed that full renationalisation is not the ultimate goal. Speaking during the April 12 debate, she said, "Our aspiration remains a co-investment agreement with a private sector partner to deliver the long-term transformation of British Steel."
Source:Mysteel Global
