Reports say that Stuart Wilkie, managing director of Tata Strip Products UK, has been named the leader of a group of managers looking for private investors for buyout plan
Mumbai: Senior executives at Tata Steel Ltd’s Port Talbot factory in the UK are expected to announce a management buyout plan for the ailing plant on Wednesday.
According to various UK media reports, Stuart Wilkie, managing director of Tata Strip Products UK, was named the leader of a group of managers looking for private investors and government support for their plan.
Senior managers at Tata’s South Wales plant were said to be called for an emergency meeting chaired by Wilkie, Sky News reported on Tuesday.
The so-called proposal is based on a ‘turnaround plan’ presented to but rejected by the board of Tata, according to ITV News, which said that the bid would require funding of £100m.
Employees could be asked to invest as much as £10,000 each, the report said.
On 18 April, Tata Steel said it has reached out to 190 potential investors for its UK assets as the Tata Group company initiated the sale process for its UK assets and appointed KPMG Llp as an adviser for the divestment of its entire shareholding in its subsidiary Tata Steel UK.
On 30 March, Tata Steel directed its subsidiary Tata Steel Europe to consider various restructuring options for its UK steel assets, including a sale in parts or whole.
On 11 April, Tata Steel announced the sale of its long products division to Greybull Capital for a nominal amount and on a debt-free basis. Analysts expect the sale of the remaining UK assets to attract a similar valuation.
As of September 2015, Tata Steel had consolidated debt ofRs.71,798 crore—most of it associated with the global operations. The stand-alone debt of Tata Steel India was atRs.25,332 crore.
Commodity tycoon Sanjeev Gupta-led Liberty House has been one of the early investors to express interest in these assets, but is unwilling to take on the liabilities related to these assets.