Sponsored by
Steel firm vows to fight to become nuclear giant
Sheffield Forgemasters is continuing its drive to become one of only two companies in the world capable of making the massive forgings at the heart of a modern civil nuclear reactor, despite losing £80 million in Government backing.
The company revealed today it is looking for new ways to fund the development of a 140 million nuclear engineering shop on its Brightside Lane site after the new Government axed an 80 million loan offered by its predecessor.
Speaking after a board meeting, called to discuss the cancellation of the loan, chief executive Dr Graham Honeyman said the company was continuing to seek ways of funding the plans, which includes the installation of a 15,000 tonne press.
"The company's proposed business expansion plan to install a 15,000 tonne press still offers a real opportunity for the company to create new jobs in Sheffield and in the subsequent supply chain and to give a major boost to UK manufacturing industry on a global level," said Dr Honeyman.
"We have no intention of standing still and will continue to explore all avenues for business development.
"We have to accept that the negotiated public sector loan element of the funding package is no longer an available option. Our board of directors will continue to engage constructively with strategic corporate investors as well as private finance providers to explore other funding options for the 15,000 tonne press project and the Government's offer to work with the Company on this is welcomed."
Dr Honeyman said the board wanted to express its "huge appreciation" for the support the company was receiving from UK organisations, businesses and individuals, many of them from Sheffield.
And he explained why the loan had been such an important part of Forgemasters' expansion plans.
"Over the past two years, we have worked with Government advisors, including the Shareholder Executive's own corporate finance experts, and negotiated a financing package which included the previous Government's loan and a substantial equity injection from the private equity market," said Dr Honeyman.
"That private equity portion was agreed to be at a level which filled the funding gap without creating unserviceable levels of debt for Sheffield Forgemasters and without excessively diluting the shares of the workforce, who collectively own 100 per cent of its shares.
"Despite these prolonged and considered efforts, we have to accept that the negotiated public sector loan element of the funding package is no longer an available option."
Dr Honeyman stressed Forgemasters continued to trade profitably and remained unaffected at an operational level by the Government's decision to axe the loan.
Got a view? Add your comment below.
READ MORE
Join the Star reader panel
Main news index
Your letters
Features
South Yorkshire's environmental news
Kids Zone
More business news
More Rotherham news
More Doncaster news
More Barnsley news
Latest sport
Email to a friend
Print this page
Looking for...
Featured advertisers
Jobs
Search for a job
Motors
Search for a car
Property
Search for a house
Weather for Sheffield
Saturday 26 May 2012
Today
Sunny
Temperature: 9 C to 21 C
Wind Speed: 17 mph
Wind direction: East
Tomorrow
Sunny
Temperature: 11 C to 21 C
Wind Speed: 14 mph
Wind direction: East
