Steel firm Celsa closes in on £30m loan
A Cardiff-based steelmaker is nearing a deal with the government for a loan of £30m to bolster its finances amid the ongoing coronavirus crisis, Sky News reported.
If an agreement is reached, Spanish-owned Celsa Steel UK will be one of the first firms to agree a bespoke funding deal outside the government’s official schemes.
Although the deal is yet to be finalised, a source told Sky that the government had been extremely supportive of the firm.
Celsa Steel UK employs about 500 people directly in the UK, with hundreds of sub-contractors.
The Department for Business, Energy and Industrial Strategy declined to comment on the report.
The discussions come after other sector members called on the government to provide financial support to the struggling industry.
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In April Port Talbot based Tata Steel called for a £500m loan from authorities, while talks have also taken place with Liberty Steel and Jingye-owned British Steel.
Port Talbot MP Stephen Kinnock has called on the government to lift its cap on the size of loans large companies can receive in order to prop up critical industries like the steel sector.
The government has thus far insisted that firms exhaust all possible financing methods before providing taxpayer-backed support.
However, under so-called Project Birch, companies which cannot access schemes like the the Bank of England’s Covid Corporate Financing Facility will be able to apply for bespoke government support.
City A.M. has contacted Celsa Steel for comment.