28 April 2004 00:13
Corus jobs pain grows with mill closure
Corus, the Anglo-Dutch steel group, accelerated the retrenchment of its UK operations yesterday by announcing the
closure of its heavy section mill at Scunthorpe later this year with the loss of 156 jobs. It is shedding a further 80
jobs at the Lincolnshire plant.
The group, which last week fought off a sustained attack on its board by Alisher Usmanov, the Russian metals mogul
who is its second-largest shareholder, is also selling the sales operation of its sheet piling business to Arecelor, the
world's biggest steelmaker.
Corus sugared the pill of further job losses by saying it would invest pounds 32m in steelmaking and production
facilities for rod and plate products at Scunthorpe - on top of pounds 12m already put in to modernise the plant this
year.
The group, which, in the first quarter, made its first operating profit since the merger of British Steel and
Hoogovens in late 1999, insists that further restructuring to concentrate on profitable parts of carbon steel in the UK
will restore its fortunes.
But the main steel union, the ISTC, while welcoming the fresh investment at Scunthorpe, said the way the announcement
had been handled was a "disgrace." Eddie Lynch, assistant general secretary, said: "Once again Corus has
shown that its pays only lip service to the concept of consultation.
"Corus has constantly said that their employees are their best resource yet they keep them and their union
representatives in the dark until the last moment. This is no way to restore success."
Under his restoring success initiative, chief executive Philippe Varin is investing pounds 250m in the UK business,
with a further loss of 1,150 jobs on top of the 6,000 announced in February 2001.
The UK workforce, which peaked at 250,000 in the mid-1970s, was just 25,000 at the end of last year and will be cut
to 22,500 by the end of 2005. The group is concentrating its output on Port Talbot, Rotherham and Scunthorpe.
Corus said the closure of the latter's heavy section mill was the result of over-capacity in European sheet
piling, used to shore up river banks and protect underground car-parks against flooding. It was not prepared to invest
in the mill to bring it up to modern requirements for wider piling which Arecelor, the Franco-Belgian-Luxembourg group,
is to supply to the UK. Corus sells just 48,000 tonnes in the UK, with a further 106,000 tonnes sold abroad.
The group said it was selling the commercial operation to Arecelor for a "quite modest" sum since the
business had no book value. Andrew Page, managing director, Corus construction and industrial, said the measures were
"very positive steps" to "improve our profitability and competitiveness."
Corus is shutting the heavy section mill at Scunthorpe but is investing pounds 44m in the remaining plant Photograph:
Richard Walker
[The Guardian] |
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