Jingye Group has informed the parent company Tata Steel and the government that it wants to study the possibility of acquiring the largest steel producer in the UK. Bank sources said Jingye’s interest is at a preliminary stage and insisted that there was no formal process for selling Tata Steel’s UK operations. However, they added that negotiations between India’s parent company Tata and the government did not make significant progress in the weeks after investment bankers were brought in to help the ministers close the deal.
If Jingye, which completed its acquisition of British Steel from liquidators in March, had indeed acquired Tata Steel UK, it would have merged Port Talbot and Scunthorpe, the two largest in the UK, into joint ownership. The Scunthorpe plan was owned by Tata Steel until 2016, when it was sold to investment firm Greybull Capital. Although much of the UK steel industry has been under the control of foreign owners for more than a decade, bringing two such large employers together under Chinese ownership would require inevitable political attention.