British Steel has won the approval by a French court in Strasbourg on Thursday to take over the Ascoval steel company in Saint-Saulve in the north of France. The factory had been waiting for a serious offer since it fell into financial difficulty in 2015, when then Finance minister Emmanuel Macron had made the promise that no jobs would be lost.
In a joint statement, the two companies said all 270 employees will keep their jobs at this site which will change its name to British Steel Saint-Saulve from May 15.
The rescue deal for Ascoval, a joint venture between Vallourec and Ascometal, was welcomed by French Finance Minister Bruno Le Maire
The second largest company in the sector, British Steel put forward 47 million euros to purchase Ascoval, matched by the same amount from the French government, according to Le Monde daily newspaper.
Le Monde suggests that one of the motivations behind the acquisition is to 'soften' the effect of Brexit. This option allows the steel giant to stay active within the Eurozone and avoid potential customs and currency problems.
Another advantage of the location of this site is that it allows British Steel to diversify its production techniques.
Better for the Environment
The fact that steel can be produced electrically as opposed to using the traditional carbon dioxide method, which has more emissions, means production will be more environmentally friendly.
The steel works in Saint Saulve, near Valenciennes (Nord) was founded in 1975 by Vallourec and became Ascoval in 2017.
It produces round steel bars used in construction sites and transport, in particular, products used in railway lines.
Around 150 million euros has been invested over the last decade to upgrade its equipment.
It produced 193,000 tons of steel in 2017 and 208,000 in 2018 with an estimated turnover of 135 million euros.