Tata may freeze auction of steelworks to assess Brexit

Mumbai-based steel giant had announced plans to auction its Port Talbot steelworks in Wales earlier this year

Cyrus Mistry

Tata Steel is set to freeze auction of its UK steelworks while it assesses the fallout of the Brexit vote, a media report said on Sunday.

The Mumbai-headquartered steel giant had announced plans to auction its Port Talbot steelworks in Wales earlier this year.

However, The Sunday Times reported the move has been put on hold as it assesses the fallout of the Brexit vote. “The company will ‘pause’ the sale amid uncertainty over the impact of the decision to leave the EU,” the newspaper quoted sources as saying. The board is yet to make a formal decision, but is under less pressure to sell after a jump in steel prices, which has cut losses at the south Wales site, the report said.

The company will reportedly stall the auction and await till the outcome of a UK government deal to cut its £14 billion  pension liabilities as well as talks on EU trade deals come out. The decision may come as a blow to bidders, including the Indian-origin businessman Sanjeev Gupta-led commodities trader Liberty House and management buyout firm Excalibur.  

The newspaper has also reported in the past that  the Tata Group had already been leaning towards retaining the plant before the Brexit decision. “The strategic review of our UK business continues. Like businesses across the UK, parties involved will be considering implications from the referendum. We remain committed to working towards the best possible outcome for our UK business,” the statement said.