Steel company's UK plant enters administration

The Gateshead site has been producing steel for more than 150 years

A steel company has announced the immediate closure of its only UK plant after it was placed into administration.

Union Electric Steel was due to close operations in spring but, after a consultation on ending production at its site in Gateshead found no solution, the company decided to accelerate its exit from the UK.

The factory was originally the Davy Roll Company before it was acquired in 1999 by Union Electric Steel and has been making steel for more than 150 years.

Unite regional officer, Anna Lavery, said the news came as a "total surprise" to union members and has potentially left them "tens of thousands of pounds out of pocket".

Owned by American company Ampco-Pittsburgh Corporation, Union Electric Steel's exit from the UK became effective on 14 October when it was placed into administration.

'Absolute disgrace'

Ms Lavery said Unite has spent "months negotiating in good faith" with the company.

"Our members are potentially tens of thousands of pounds out of pocket now despite standing by the company through the recent months to ensure final orders were prepared for customers and this is how they are being repaid," she said.

"It is an absolute disgrace by American owners Ampco-Pittsburgh."

Sam Lyon, president of Union Electric Steel, said it was "an extremely difficult decision" and cited the challenges it has faced over recent years.

They included unpredictable and high energy costs compared to competitors, lack of demand for the product and increased imports of rolls and flat rolled steel into Europe from low-cost countries.

Brett McBrayer, CEO of Ampco-Pittsburgh Corporation, said the company "accelerated" its exit from the UK due to "the high cost of a wind-down closure along with the recent tariff volatility affecting demand and order timing".