Sheffield Forgemasters nationalised amid fears of collapse
The Ministry of Defence (MoD) has bought out Sheffield Forgemasters, a key supplier to the UK’s nuclear programmes, it was confirmed today.
The firm said that the £2.6bn investment would “secure Sheffield Forgemasters’ role as a critical supplier to the next generation of UK Defence programmes, while continuing our independent commercial activities.”
After increasing concerns that the company’s failure could hit the UK’s defence capabilities, the government decided to step in and nationalise the firm.
It will now put £400m into Sheffield Forgemasters over the next decade in order to replace old machinery and build new assets.
The firm said it would not have been able to make such an investment without the government’s backing.
Under the deal, the firm’s corporate structure will remain intact, although 100 per cent ownership will pass to the MoD.
The potential nationalisation was first reported by Sky News, which said such a step had been in the offing for months.
Unite’s assistant general secretary for manufacturing, Steve Turner, welcomed the move: “This is the news we’ve waited two years to hear.
“Unite has been engaged in a long battle with the Ministry of Defence and the UK government to protect UK steel supply to our defence and nuclear programmes so today’s news will be welcomed with a huge sigh of relief right across our steel communities.”
Sheffield Forgemasters dates back to the 1750s, but has been hamstrung by increased financial difficulties in recent years.
In 2016, three of the UK’s industrial blue-chips, key MoD partners BAE Systems, Babcock International, and Rolls-Royce, underwrote a £30m loan for the firm from Wells Fargo.
Its role in the submarine programme is shrouded in secrecy, but is believed to involve the design and manufacture of advanced steel components.