SSI takes £530m hit on Redcar liquidation

Tees Business Digital Media Pack

SSI steelworks redcar

SSI UK’s parent company is set to lose about £530m by liquidating its Redcar steelworks operation, the company has confirmed.

The Teesside plant was mothballed in October with about 2,000 jobs being lost.

Now, new documents filed by Thai business Sahaviriya Steel Industries (SSI) have revealed the impact of the closure.

Its liquidation meant SSI recorded an overall third quarter loss of 33,122m baht (£605m).

Of this total, about 28,877m baht (£527m) was lost on SSI UK.

Group chief executive Win Viriyaprapaikit said: “At present, the company on a conservative basis expects zero recovery after the completion of the SSI UK liquidation.

“Global steel over-capacity and demand imbalance since late 2014 and the continuous decline in steel price resulted in a huge operating loss for the group this year.

“There are uncertain external factors which are beyond the company’s control, for instance the validity of environmental permit, access and ability to safeguard the assets etc.

“The legal and liquidation proceeding in this case is unprecedented and unclear to the company at this stage.”

At the time of the collapse, Cornelius Louwrens, UK business director and chief operating officer of SSI UK, said: “Despite the significant progress we made in the financial performance of the business during 2014, market conditions this year have been extremely challenging and unfortunately this has led to the decision we are announcing today.”

SSI has entered a legal process known as “business rehabilitation” in Thailand, aimed at securing the future of the remainder of its operations.

 

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