Industrial giants push for overhaul at Sheffield Forgemasters

Three industrial heavyweights are pushing for change at steel giant Sheffield Forgemasters, which includes a hunt for a new chief executive.

BAE Systems, Babcock and Rolls-Royce are understood to be looking to replace Forgemasters boss and majority shareholder Graham Honeyman while also pressing for a new business plan, according to Sky News.

BAE, Babcock and Rolls-Royce are a major influence at Forgemasters, a vital supplier to firms building Britain’s controversial nuclear Trident submarine programme, due to an arrangement in place since 2016 for them to underwrite £30m of loans to the company from the US bank Wells Fargo.

The move came in a bid to insulate themselves from the steel crisis which hit other big manufacturers including Tata Steel.

The process to implement changes is already underway, it is understood, and comes as the company also hunts for a new chairman following Tony Pedder’s retirement in May after more than a decade in the role.

Today, sources told Sky News the Ministry of Defence (MoD) is monitoring the move by BAE Systems, Babcock and Rolls-Royce. It was also reported a former BAE Systems exec was among the list of prospective candidates to replace Honeyman.

Forgemasters, Britain’s oldest steelmaker, has fallen on hard times in recent years facing increasing competition from around the world but last year turned its performance around in a breakthrough year, narrowing losses by more than £6m.

Efficiency measures, continued investment and an aggressive drive towards new markets were behind the turnaround, the company said.

Forgemasters employs 650 staff across its 64-acre Brightside Lane site and serves industries including defence, nuclear power, materials processing, offshore oil and gas and power generation.

Sheffield Forgemasters has been approached for comment.