Tata Steel Europe's CEO Hans Fischer told employees of the group he would do "everything" to remedy their concerns over the proposed joint venture with ThyssenKrupp Steel Europe.
In a briefing sent to S&P Global Platts Monday, Fischer said he "recognized" the concerns of workers and understood with "change comes uncertainty," but that the JV would enable the companies to "create a stronger new business."
"Both Tata Steel and ThyssenKrupp have committed to continue with the current asset configuration at all upstream sites, including IJmuiden and Port Talbot," Fischer said, reiterating what was laid out in the original releases about the memorandum of understanding.
"While we will continue to strengthen our UK business through an investment-backed transformation programme, the strong position of the IJmuiden business with the current strategic investments has also been recognized by both Tata Steel and Thyssenkrupp," he said.
Unions in the UK have been working to get guarantees blast furnace 5 at Port Talbot will be relined as soon as possible, as they think it will give the site longevity in terms of crude output.
A source close to Tata said this was unlikely, describing blast furnaces as a technology of the past, and suggesting electric arc furnaces may be installed.
A blast furnace reline can cost anywhere between GBP100 million-160 million ($132-$212 million) depending on the size of the unit, one UK steelmaking executive told Platts.
Therefore whenever it comes to relining a unit, decisions always need to be made over its viability and competitiveness against other technologies, he said -- EAFs are less capital intensive, more flexible, and could be fed with domestic material rather than material imported from Australia, Brazil and elsewhere.
Asked if BF5 would be relined, Tata Steel's Koushik Chatterjee, group executive director, finance and corporate, told Platts that was an operational decision that would be made by operational management.
UK union representatives suggest they make many more tons/man than Ijmuiden and Duisburg, despite being smaller units, explaining, in their view, why there has been more concern on the mainland over the merger.
The Central Works Council of Tata Steel Netherlands said Friday the number of jobs lost would "go beyond" the 4,000 losses laid out in the initial press releases about the deal.
"Current indications are that the new company plans to outsource large swathes of the support services to low-wage countries," it said.
It also said Tata Steel Netherlands would "lose much of its independence, including as regards its own cash position."
It said the supervisory board of Tata Steel Netherlands "will no longer be independent and that the board of directors of TSN will not be properly constituted."
With due diligence for the deal now underway, the works council said it "has informed the board of directors and supervisory board of TSN that it will not be supporting these plans."
