Facing deep financial losses following the 2008 recession and overall dampening of demand in the steel market, Tata Steel is selling off its UK business. The move puts almost 15,000 jobs at stake. Tata Steel’s Port Talbot steel plant is the largest in UK and it has been bleeding money for years now. While they are trying to make a sale, the chances of finding a buyer is slim and the operations could close all together in as less as six weeks.
While Tata Steel is winding off operations in the UK, it is in talks with ThyssenKrupp about a merger, which will make the entity one of the Europe’s biggest. Tata steel had earlier laid off 750 employees in January. The move is also partly due to “dumping” from Chinese companies which are selling steel to Europe at a loss. The dumping also caused 16 of the 20 companies of Caparo Group, owned by Swaraj Paul, to go into administration due to eroding margin in the steel business in UK.