Liberty House has acquired the speciality steels division of Tata Steel in a £100m deal that will create 300 new jobs in South Yorkshire and secure 1,700 existing jobs.
The company, which plans to relaunch as Liberty Speciality Steels, will invest £20m in new plant and equipment within the first year to boost competitiveness.
The speciality steels business produces a range of high-value steels used in the manufacture of vehicles, aircraft, industrial machinery and equipment for the oil and gas industry.
Production from the arc furnaces is expected to rise to more than a million tonnes a year, and there are plans for the bar mill to roll around 400,000 tonnes a year.
The acquisition gives Liberty the largest arc furnace capacity in the UK, which is key for its Greensteel plan to increase low-carbon steel production using recycled metal in furnaces powered by renewable energy.
Jon Bolton, chief executive of Liberty Speciality Steels, said: “Through increased output and improved positions in the UK, North America and EU markets, the business can improve its competitiveness and re-establish itself as a global force in the supply of engineering steels.”
The acquisition will make Liberty one of the largest steel and engineering employers in the UK, with more than 4,500 workers.
Sanjeev Gupta, executive chairman of Liberty House, said: “The speciality steels business is a global leader in its field, with a highly skilled and well-motivated workforce. We are eager to invest so it can grow and achieve its full potential.
“By investing to acquire speciality steels, we are casting a big vote of confidence in the future of British industry. With the right business model and an innovative approach, the UK steel and engineering sectors can recover and thrive.
”The Government is now pursuing a new post-Brexit industrial strategy and steel must be at the heart of that strategy.”
Arc furnaces are capable of using more recycled metal than blast furnaces.
Robert Fell, chief executive of the British Metals Recycling Association, said: ”I think it’s very, very good news.
“Anything that will enable more secondary metal to be used within the shores of the UK has got to be a good thing. The industry exports something like 80% of metal that we recycle in this country.
“We’re very good at collecting and recycling, unfortunately there is not the infrastructure in this country to use the material.”
Local metal merchants cautiously welcomed the arrival of Liberty House late last year, hoping it would boost competition and quality in the area.