The 215-year-old company has been fully acquired by the Ministry of Defense in a £ 2.56million deal and the promise of a £ 400million investment over the next 10 years .
Speaking to The Star today, the manufacturer’s chief financial officer, Stephen Hammell, said the move was “very positive news for the city” and the staff.
“At the heart of the deal announced today is the intention to invest up to £ 400 million there to develop our capacity to support defense,” said Mr Hammell.
“This is great news for our employees and our customers.
“It will transform our capabilities over the next 10 years. “
The chief financial officer said the nationalization of Sheffield Forgemasters had been in talks for more than two years and had been agreed on the grounds that the government was investing £ 400million in the replacement and modernization of much of its workshop. machining and its forging equipment.
It includes replacing the company’s 65-year-old forges, strengthening flood defenses and, over the next 10 years, installing 19 new machine tools, each larger than a house to two floors.
It will also finance the construction of a large warehouse as a base for a 13,000-ton press the company bought last year from a Japanese competitor for £ 125million.
It comes after the company laid off 95 positions in October 2020 due to the impact of the pandemic on its commercial manufacturing.
It has been a long-term steel supplier for Defense components to the Department of Defense on projects such as the UK’s Trident nuclear submarines.
Mr Hammell said there was “no immediate intention” to change its workforce after the takeover.
He said: “There will be a huge amount of investment in the business, and it will spill over to the local and regional economy and we expect it to create jobs.
“In the longer term, we would expect that by entering new markets such as offshore wind farms and civil nuclear markets, we could create new jobs for highly skilled engineers in the city. “
The nationalization comes on the basis that the government has taken ownership of the company and all of its shares while appointing two non-executive members to its board of directors, who have not yet been selected.
Mr Hammell said the company would be unlike the post office because of its “near independence” from the Department of Defense.
He said: “The Defense Ministry, having accepted this investment, has quite reasonably sought to take ownership of the company if it wants to support us with so much money.
“We are looking to grow and recover in commercial markets over the next several years.
“I think for Forgemasters this heralds a very bright future for the company.”
The deal is expected to be finalized on August 19. It will continue to be led by its current management.
Unite’s hardline union leaders greeted the buyout with what they called “a huge sigh of relief.”
This move is unusual for a government led by the Conservative Party, which has historically opposed nationalization.
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This notice was published: 2021-07-28 12:29:49