Tata Steel has announced it has sold its 42 and 84-inch pipe mills in Hartlepool to an international company.
A definitive sale agreement has been reached to transfer the pipe mills – the largest in Britain – into the hands of Liberty House Group.
About 140 people are employed at the pipe mills, in Brenda Road, to manufacture pipeline for gas and oil products around the world.
International industrials and metals group Liberty House will now conclude discussions with a range of stakeholders on a support package to help maintain the jobs there, and recruit more staff.
Meanwhile, the 20-inch tube mill at the same Hartlepool site, where another 270 people work, will remain under the ownership of Tata Steel.
The company will make a £1million investment to increase the mill’s capability to make high-strength steel tubes.
Bimlendra Jha, CEO of Tata Steel UK, said: “As a responsible seller we have worked long and hard to find a sustainable future for the 42 and 84-inch pipe mills.
“With this sale, Tata Steel UK will complete its portfolio restructuring to focus on the strip products supply chain linked to Port Talbot.
“The sale is also an important step towards developing a more sustainable future for the rest of our UK business.”
The 42-inch and 84-inch longitudinal submerged arc welded (LSAW) pipe mills at Hartlepool make heavy-duty steel pipe for the energy, power and construction industries in the UK and worldwide.
They have a combined production capacity of over 250,000 tonnes a year.
Sanjeev Gupta, executive chairman of the Liberty House Group, said: “This is an important addition to our group.
“Hartlepool has world class LSAW pipe mills, and a skilled workforce, with a long history and recognition worldwide.
“This step will inspire investments not only in Hartlepool but also in our upstream plate mill at Dalzell, and potentially also at the steel shop at Whyalla in Australia in due course, to give us a fully integrated world class capability to supply pipeline projects.
“The Hartlepool pipes business has faced difficulties in recent times due to the downturn in the UK oil and gas sector but we are eager to begin working with management and staff here to regain former market share and to explore expansion into new areas.
“These mills can be a symbol of a new Britain, integrated with the world economy exporting a world class product once again globally.
“We will engage with all customers of the business locally and internationally to regain our market share.”
Politicians and unions welcomed the deal.
The MP for Hartlepool, Mike Hill, has welcomed the news.
He said: “This acquisition comes after a long period of uncertainty about the future of both Pipe Mills and is very good news for the workforce, the local economy and for the future of the Steel Industry in the town.
“Liberty’s commmitment to grow the business and invest in new jobs is a welcome development and is a testimony to the quality skills and manufacturing base we have in Hartlepool.”
It is expected that the workforce at the business will be upskilled, and new products will be developed.
Both parties will now work to complete consultations with employees and trade unions, as well as the transfer of supplier and customer contracts.
It is expected that the process will be completed within the next few months.
GMB, the union for steel workers, has also welcomed the announcement.
Ross Murdoch, GMB’s national officer, said: “This is great news for our members who have been through a long period of uncertainty.
“Our members have fought to protect the Hartlepool saw mills and deserve a long term future.
“The order book was running low and this news brings comfort to our members’ families and communities.
“We hope the deal can be completed sooner rather than later so our members can get on doing what they are good at and that is producing steel.
“We have to remember that without steel we just don’t have a sound manufacturing base.”
Coun Kevin Cranney, chair of Hartlepool Council’s Regeneration Services Committee, said: “We welcome today’s announcement which represents a significant step forward in securing the 42-inch and 84-inch pipe mills in Hartlepool.
“Liberty House is a major player in the steel industry and it’s really encouraging that they are not only looking to preserve the existing 140 jobs, but invest in the business and create even more jobs in the future.
“Over the coming weeks the council will continue to work closely with its partner organisations, including the Tees Valley Combined Authority, to provide a package of support to help the business grow.”
Britain’s largest union, Unite, praised steelworkers’ resilience after the announcement, which ended months of uncertainty for workers.
Unite national officer Tony Brady said: “Today’s announcement is welcome news and ends the months of uncertainty this world class workforce has had to endure.
“Throughout the process workers have shown great resilience and professionalism.
“It is in no small part thanks to their hard work that Tata has been able to find a reputable buyer and commit to further investment in its 20-inch tube mill.
“Unite looks forward to working with Liberty House to ensure the smooth transfer of the workforce and that the business goes from strength to strength.”