Acquisition of Caparo Merchant Bar will help “rebuild the UK steel industry”

Liberty House has acquired Caparo Merchant Bar from the administrators of Caparo Industries, a move that safeguards 145 jobs at CMB’s two rolling mills in Scunthorpe.

CMB is Britain’s largest producer of merchant bar and its Lincolnshire facilities produce steel bars and light sections for the construction, energy, infrastructure, oil & gas, shipbuilding and transport industries. The acquisition is expected to complement Liberty’s network of steel plants in the UK and enable the company to supply the market with an extensive range of steel products.

Sanjeev Gupta, executive chairman of Liberty House Group said: “CMB fits perfectly into our GREENSTEEL vision for the UK steel industry and completes our product offering to the market.

“We can now supply an extensive range of both flat and long products, with steel mills in all parts of the country. This will enable us to compete more effectively and win market share from imports, helping rebuild the UK steel industry.”

The acquisition requires an expected final agreement with the pension Trustee concerning Caparo Industries’ 1,700-member pension scheme.

The directors of CMB kept the company profitable despite Caparo Industries going into administration in 2015. Despite this, CMB remained coupled to the Caparo 1988 Pension Scheme, effectively restricting CMB’s ability to develop its own financial flexibility.

In a statement, Liberty said it has sought a solution that protects the business and the pensions of its employees. Liberty House representatives have been in discussions with the Trustee of the Pension Scheme. This scheme has 1,700 members including most CMB employees and existing employees of Liberty though its acquisition of Caparo Industries business assets in 2015.

Liberty Industries CFO, Derek O’Reilly said: “We have been working with the pension scheme Trustee to deliver a solution which we believe is deliverable although this area is complex and there is still execution risk.

“However, to prevent the business going into administration, and losing all possibility of a pension solution, it was essential that we immediately acquired the business to provide the possibility to protect CMB employees’ benefits.”

Read full original article »