Industry giants come up with £30m deal to aid struggling manufacturer
INDUSTRY giants have handed a £30m support package to steelmaker Sheffield Forgemasters.
The Ministry of Defence brokered a deal which saw BAE Systems, Babcock International and Rolls-Royce Holdings underwrite bank loans to the manufacturer.
Forgemasters is a supplier to the Government’s nuclear development programme Trident.
Trident is due to be replaced in the 2020’s, at a cost of £20bn, through estimates say that it could be as much as £100bn.
Submarine Enterprise Partners, which delivers replacement nuclear submarines have agreed to provide guarantees for just under £30m of loans provided by the US bank Wells Fargo to Forgemasters.
BAE, Babcock and Rolls Royce are corporate stakeholders in SEP.
Earlier in the year it was suggested that a Chinese state-backed company would aid the business. These claims were met with “unease” at Whitehall according to Sky News.
In January, Sheffield Forgemasters announced 100 redundancies after reporting a £13.6m loss.
This was the first loss for the company in more than a decade. The global crises in the steel and oil and gas industries has hit the business, with annual turnover down 18%.
Graham Honeyman, chief executive at Sheffield Forgemasters International Ltd, said : “Agreements between this company and its finance partner remain commercially confidential as do our commercial agreements with customers across all sectors.”
