Today's Top Gainer
Note:Top Gainer - Nifty 50 More
The company announced in May 2018, the potential sale of five non-core businesses, enabling it to strengthen its focus on its strategic markets. Buyers have been found for Kalzip and Firsteel, helping to secure 275 jobs.
One of the five non-core businesses was Cogent Electrical Steels, which is made up of:
1. Orb Electrical Steels, in Newport, South Wales
2. Cogent Power Inc, in Burlington, Canada
3. Surahammars Bruks AB, in Surahammar, Sweden.
Tata Steel has signed a sales and purchase agreement for Cogent Power Inc (CPI), with Japanese steel giant JFE Shoji Trade Corporation. CPI manufactures cores for electrical distribution transformers and employs nearly 300 people.
Furthermore Tata Steel has decided to retain Surahammars Bruks AB, which makes advanced steels for electric vehicles and employs around 100 people.
However, despite exploring all options, Tata Steel has been unable to find a way forward for Orb Electrical Steels and so proposes to close the site, with the potential loss of up to 380 jobs.
The Orb Electrical Steels business has been loss-making for several years as it struggled to compete in the fast-moving market to supply steels used in electricity transformers in which customer requirements have out-stripped the sites capability. Converting the site to create steels for future electric vehicle production would cost in excess of £50 million in a highly competitive market where Tata Steel faces higher-volume competitors both in Europe and globally.
In addition, Tata Steel has been unable to find a buyer for Wolverhampton Engineering Steels Service Centre, in the UK, and proposes to close it, potentially affecting up to 26 jobs, including a sales office in Bolton.
Every effort will be made by Tata Steel to mitigate the impact on affected employees including offering alternative employment opportunities where possible at other Tata Steel sites. Consultations with affected employees and trade unions at both Orb and Wolverhampton will commence shortly. This process will include assessing ways to minimise the need for compulsory redundancies.
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