Steel firm takes legal action in attempt to force reversal of decision that could force UK plant closure
Steel company Corus is launching a legal action against a group of foreign executives for allegedly cancelling a deal that puts its Teesside plant at risk of closure, according to a report in the Mail on Sunday.
The paper said that lawyers for the Anglo-Dutch firm are seeking to force a consortium of four firms to reverse a decision to abandon a 10-year agreement to buy stock from the Redcar plant.
The firms are the Marcegaglia lead company, South Korea's Dongkuk Steel Mill Company and Luxembourg-owned Alvory and Duferco. A spokesman for the group told the newspaper that it would not engage in talks with Corus until the action was withdrawn.
He said: “Although it has no obligation to do so, the group has opened the door to new discussions. But the aggressive litigation initiated by Corus remains a block to these talks starting.
“There is no appetite to sit across the table from a loaded gun. All Corus needs to do is to suspend its litigation against the consortium members.”
Corus said the consortium had failed to honour a long-term agreement that was “crucial” to its operations in the North-east of the UK.
A spokesman said: “The consortium's failure to meet its contractual obligations automatically triggers arbitration.”