Steel news continues to cover the announcement that UK steel
producer and distributor Aartee Bright Bar (ABB) has gone into administration.
The move came after ABB’s commercial financier, FGI, decided to enforce its
debts against the company. According to a February 7 report from Sky News, the
West Midlands-based business appointed New York-headquartered Alvarez &
Marsal as administrators.
Administration in the United Kingdom is similar to Chapter 11 of
the United States Bankruptcy Code. It generally occurs whenever a company is
unable to pay its debts. Neither Alvarez & Marsal’s London offices nor
parent company Aartee Group was available for comment. However, the latter
issued an email statement on behalf of ABB.
“Despite the very significant challenges facing the UK steel
industry, Aartee Bright Bar has been making regular and substantial payments to
its creditor FGI.” Sky News also quoted the parent company as saying, “it is
therefore disappointing that FGI has chosen to enforce on a small remaining
debt which the business has a plan to clear in the very near future.”
ABB’s Production Capabilities Crucial to Multiple Industries
Bright bars are value-added long products with high tolerances and
both smooth and shiny finishes. ABB produces them in various shapes, including
round, flat, square, and hexagonal. Applications include engineering and
construction, fastener production, machine component manufacturing, and tool
manufacturing. Bright bars are also used in the auto sector to create frames
and chassis.
Steel news reports indicate that Aartee Group originally acquired
ABB, then known as Acenta, in July 2018. ABB’s main office and production sites
are in England’s West Midlands region, which also houses a distribution center.
The company also has distribution centers in North West England and Wales.
Bright bar production facilities at ABB include a bank of
high-speed coil-to-bar drawing machines. There is also a complement of bar-fed
draw benches, turning and polishing machines for large-diameter rounds, and
milling machines for squares and flats. Besides bright bars, ABB also produces
hot rolled products in 120-, 140-, 150-, 180- and 210-mm dimensions. They
accomplish this by re-rolling engineering-grade flat and steel bars on-site.
More UK Steel News
The UK steel industry continues to face difficulties due to the
effects of the COVID-19 pandemic. This has not been aided by high energy costs
caused by Russia’s invasion of Ukraine or the country’s poor 2023 economic
outlook. Indeed, the International Monetary Fund expects the UK economy will
shrink 0.6% in 2023.
Tata Steel and British Steel are two UK facilities equipped with
blast furnaces. Unfortunately, they also face heavy carbon taxes. That said,
the UK Government has proposed a £300 million (over $362 million) package to
each of those companies. The goal is to help them cover the cost of replacing
those blast furnaces with newer electric arc furnaces.