Trade

British Steel collapses as government rejects emergency funding

British Steel, the U.K.s second-largest steel producer, was put into administration today, with the loss of up to 5,000 jobs.

A further 20,000 jobs along the companys supply chain are also at risk, the BBC reported.

British Steel had been trying to secure £75 million in emergency funding to help it address what it called “Brexit-related issues.” It also faced a weaker pound and heightened trade tensions between the United States and China. Orders from European customers have slumped, according to media reports.

In a statement, Business Secretary Greg Clark said the government had worked “tirelessly” to secure a solution for British Steel, but “can only act within the law, which requires any financial support to a steel company to be on a commercial basis.”

“I have been advised that it would be unlawful to provide a guarantee or loan on the terms of any proposals that the company or any other party has made,” he added.

EY was appointed as special manager to assist in the companys administration, Reuters

Related Posts