Corus four consortium members have abandoned the Teesside Cast Products plant after talks to assess how it can be saved failed.
At a meeting with Corus on 23 July, the consortium members decided they would be unable to guarantee long-term offtake at a sufficient volume.
The aim of the meeting was to find a way to provide a sustainable future for the plant, since the consortium members pulled out of a 10-year agreement, signed in 2004, to buy 78 per cent of the steel in April. (See MRW story)
Corus chief executive Kirby Adams said: We feel great sympathy with our employees and the Redcar community because of the continuing anxiety they are experiencing about their future due to the consortiums termination of the offtake agreement without notice. We have kept the plant going for 100 days without any external business and continue to do everything in our power to keep TCP in operation despite the consortiums breach of contract and the economic downturn.
The consortium was made up of Macegaglia spA, Dongkuk Steel Mills, Duferco Participations Holding and Alvory SA.
Corus has been looking at other options to keep the plant open since receiving the termination notice. It has been looking at alternative transactions which could lead to an acquisition since mid-June.
While negotiating with the consortium, Corus has been loading the plant with internal orders to maintain operations, managing to stretch the TCP order book to the end of August. It is hoped the September order book will be filled soon as the firm is also generating external enquiries for the plants high-quality slab products, giving Corus extra time to find a long-term solution to secure the future of the business.