British Steel is to go into official receivership after failing to secure £30 million in emergency funding, sources say.

This means at least 4,500 British workers are at risk of being made redundant, mainly in Scunthorpe, and a further 20,000 in the UK’s second biggest steel maker’s supply chain.

The request for emergency financial support from the government is understood to have been reduced from £75 million to £30 million.

British Steel borrowed £100 million from the government in April after it got frozen out of an EU-wide carbon trading scheme due to failed Brexit negotiations.

Sources close to owner Greybull told Sky News that British Steel would be declared bankrupt if it failed to pay back £30 million by Wednesday.

It comes after union leaders laid out their concerns to the government amid reports the company was facing insolvency due to Brexit-related issues.

The Unite union said they would speak with business secretary Greg Clark on Tuesday and urged owner Greybull to strike a deal with the government.

A spokesman said before the news: ‘We would urge Greybull to reach a deal with the government. Thousands of jobs depend on the outcome.’

The company had asked for a package of support to tackle the issues caused by Britain’s pending exit from the European Union.

With thousands of jobs in the balance, the timing could not be worse for Prime Minister Theresa May’s government.

Elections for Britain’s 73 seats in the 751-seat European Parliament take place Thursday.

The company had asked for a package of support to tackle issues related to Britain’s pending departure from the European Union.

Last week British Steel announced it had the backing of its key stakeholders and that operations would continue as normal.

The company had asked for a package of support to tackle Brexit-related issues and has been holding talks with the Government, raising fears for the future of the company.

It said on Thursday: ‘We are pleased to confirm that we have the required liquidity while we work towards a permanent solution.’

This is a breaking news story… more to follow 

Got a story for Metro.co.uk?

If you have a story for our news team, email us at [email protected].

You can also follow us on Facebook and Twitter.

Source: Read Full Article