The Thamesteel works in Kent has been rescued, its administrators have announced.
Accountancy firm Mazars said the Sheerness company - a major historical buyer of scrap - has been bought out of administration by a new company set up by its Saudi owners the Al-Tuwairqi Group (ATG).”.
Mazars said the deal would allow steel production to recommence at the site, re-creating many of the 400 jobs lost when the firm went into administration in January 2012.
Joint administrator Rod Weston said: “This sale is very good news for Sheerness. It concludes what has been a long and painful process for all involved.
“At many points we feared the eventual outcome might be very bleak for the future of steel production on the Isle of Sheppey. However, after several false dawns, we have secured a sale to the only bidder to come forward with the intention of restarting production at the plant.”
Weston thanked local MP Gordon Henderson and the Department for Business, Innovation and Skills for their support.
Michael Leahy, general secretary of steel trade union Community, said the news was “fantastic” for his members who had “fought a long, hard campaign” to save the works.
He added: “It is a moment for our members to feel proud of their efforts and overcoming the challenges they have faced in recent months before we look forward to a renewed partnership with the new owners so we can bring steelmaking and jobs back to Sheerness.”
Labour business minister Iain Wright MP called the announcement a “great result”. He said: “Although it is still not clear whether all those jobs lost when the plant went into administration earlier this year will be reinstated as a result of today’s news, we very much hope that as many jobs as possible will be secured as production resumes at the plant.”
Scrap merchants in the south east of England told MRW in February that the closure of the works meant the loss of a “significant” home market for their material, purchasing around 50,000 tonnes a month.
Merchants said the loss of capacity would make them more reliant on volatile export markets and force prices down.
Ian Hetherington, director-general of the British Metals Recycling Association, told MRW at the time of the firm’s collapse: “It is desperately sad to lose more UK jobs and steel production capacity. Thamesteel has been a valued customer for our members.”
Thamesteel’s facilities include an electric arc furnace that melts steel scrap to produce long steel products used in construction.