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Cengiz on Standby to Buy British Steel if Jingye Bid Fails

Steel News - Published on Thu, 23 Jan 2020

Image Source: The Guardian
While officials remain confident that Jingye’s GBP 50 million purchase of British Steel will go ahead in the next few weeks, the Guardian understands that the Department for Business, Energy and Industrial Strategy has also been examining a back-up plan involving Istanbul-based Cengiz, which enjoys close ties to the Turkish regime.

Jingye’s preferred bidder status affords it the sole right to negotiate a deal with the official receiver, the government employee managing the sale alongside the accountancy firm EY. But BEIS is not bound by the exclusivity arrangement and is keen to limit the amount of time it continues to own a business that collapsed into insolvency eight months ago and is losing about GBP 1 million a day.

Cengiz’s founder Mehmet Cengiz enjoys very close relations with Turkish President Recep Tayyip Erdogan. He has enriched himself by winning several major construction contracts in Turkey since Erdogan’s government came to power in 2002, including to build and operate Istanbul Airport, which is set to become the world’s largest should all construction phases be completed.

Jingye, led by the former Communist party official Li Ganpo, only became the preferred bidder after a deal with Ataer Holdings, a unit of the Turkish military pension fund Oyak, disintegrated. While Oyak has links to the Turkish government and military, the regime is understood to favour a deal involving Cengiz, which also has connections to the state.

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Posted By : Rabi Wangkhem on Thu, 23 Jan 2020
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