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Corus takes action

Steel giant Corus has taken legal action to try to prevent a consortium from pulling out of a contract to buy the majority of the steel from its Teeside Cast Products plant.

A spokesman for Corus told MRW: There have been legal proceedings, which sought an immediate solution for Teesside and which are now concluded. Those proceedings are unrelated to any future legal action that Corus might seek to take against the consortium for terminating the contract.

The spokesman would not confirm that this was a High Court injunction as speculated by other media outlets.

MRW understands that this legal action did not result in any significant changes to the current contractual dispute.

In 2004, the consortium of Marcegaglia spA, Dongkuk Steel Mills, Duferco Participations Holding and Alvory SA agreed to buy just under 78 per cent of the plants production for 10 years. However, the consortium pulled out of the agreement at the beginning of May.

The news came as Redcar MP Vera Baird QC flew to Italy on 21 May to save up to 2,000 jobs by discussing the situation with consortium leader Antonio Marcegaglia. She was joined by Coruss trade union group Community Union general secretary Michael Leahy. Marcegaglia invited Baird to have a meeting after she wrote to him regarding the potential mothballing of the plant as a result of the consortiums decision.

In a statement after the meeting Baird said: Marcegaglia indicated that under the right circumstances they were willing to encourage their partners to sit down with Corus in the UK to explore new possible commercial solutions which will preserve production at TCP and assist the process of safeguarding jobs. This is the message we will be taking back to Corus and the UK Government and we hope that they will ensure such talks can take place as a matter of urgency.

Business Secretary Lord Mandelson has pledged the Governments support to keep the Teesside plant open.

A spokeswoman from the Department for Business, Enterprise and Regulatory Reform said the Government is ready to help Corus once it identifies the action it wants to take. She added that Lord Mandelson has asked the embassies from the countries in which consortium members are based to explore the options for reopening discussions with Corus.

Other MRW stories on this issue:
Industry positive after steel summit
Peter Mandelson concerned over possible mothballing of TCP plant

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