More than 400 jobs at a British Steel subsidiary have been secured following its sale to a French engineering giant.
As first reported by Sky News, Systra, which has been engaged in talks to buy the infrastructure design consultancy TSP Projects (TSPP) for three months, has clinched a deal to buy the business, along with its £70m-plus pension liabilities.
The agreement has been confirmed by the Official Receiver, which has been managing British Steel since it collapsed into compulsory liquidation in May.
TSP Projects has a new owner, International mass transit, mobility and infrastructure company SYSTRA. From today TSP Projects will become a wholly owned subsidiary of SYSTRA Ltd and will be known as TSP Projects a SYSTRA company. pic.twitter.com/MBTGYyQom5
— TSP Projects (@TSPProjects) August 30, 2019
It made clear the deal had no impact on the proposed sale of British Steel’s wider business, including its vast steelworks in Scunthorpe, to Ataer Holdings, a subsidiary of Turkey’s military pension fund.
The Official Receiver said: “The sale of TSPP’s shares to Systra Ltd – the UK subsidiary of French-based Systra Group – will expand Systra’s footprint in the UK and preserve over 400 jobs at TSPP.”
Confirmation of the deal between Systra and TSPP makes it the first British Steel division to be sold to new owners since the group’s collapse in the wake of a government decision not to provide further state funding.
Sky News revealed last week that the sale of TSPP was being held up by the need for a secured lender to agree to the transaction.
The lender, PNC, agreed to do so earlier this week, according to insiders.
The sale safeguards the interests of roughly 500 pension scheme members and 400 TSPP employees, many of whom are based at its York headquarters.
TSPP has contracts to work on railway systems at Gatwick Airport and broader infrastructure design in aviation, construction, energy and security.
Its biggest clients include Network Rail, Siemens and Costain.
Systra is owned by the French state railway SNCF, RATP and a consortium of French banks.
The company counts Andrew McNaughton, the former chief executive of Balfour Beatty, among its top management.
Its attempt to buy TSP Projects has drawn the attention of the UK’s Pensions Regulator because of the roughly £70m deficit in its retirement scheme.
TSP Projects’ pension scheme has only 14 active members, about 400 deferred members and 133 members who are receiving pensions from the company, according to information circulated to bidders.
British Steel’s collapse into insolvency came just weeks after Greg Clark, the then business secretary, handed a £120m government loan to the company to help it meet its obligations under an EU scheme for industrial polluters.
A further support package was due to be given to British Steel but was withdrawn at the 11th hour amid concerns that it would breach state aid rules.
Sky News revealed earlier this month that ministers had signed off a support package worth around £300m to aid Ataer’s efforts to buy British Steel.