Investor Proposes Combining UK and Italian Steel Operations
British investor Michael Flacks has expressed strong interest in acquiring British Steel with plans to merge it with an Italian steel plant, potentially creating one of Europe’s largest metals conglomerates. The Miami-based Flacks Group, specializing in distressed asset acquisitions, is reportedly preparing a bid for the government-controlled Scunthorpe facility.
“Someone needs to take control of British Steel – it’s a facility of national importance,” Flacks stated. “I see significant opportunity in a sector many have overlooked, with strong confidence in its future potential.”
Revitalization Plan for Struggling Manufacturer
This potential acquisition represents the latest effort to stabilize the loss-making steelmaker, which employs 3,500 workers at its Lincolnshire operations. The manufacturer has faced ownership challenges since Greybull Capital’s acquisition in 2016 ended in insolvency by 2019. Current owner Jingye Steel prompted government intervention last year through emergency legislation amid concerns about operational continuity.
Industry analysts note that British Steel and other European producers continue facing competitive pressures from Chinese steel overproduction, which now accounts for over half of global output. Recent financial disclosures indicated the Scunthorpe operation was losing approximately £700,000 daily prior to announced closure plans in March.
European Consolidation Strategy
Flacks Group simultaneously pursues acquisition of Italy’s former Ilva steelworks, having secured €5 billion in financing commitments for its revitalization. The investor’s strategy involves combining both steel producers to capitalize on growing European preferences for regional suppliers.
“We plan to consolidate European steel operations,” Flacks explained. “With anticipated infrastructure growth and reduced Chinese ownership influence, market receptivity to British Steel products should increase significantly.”
Investor Background and Long-Term Vision
With an estimated net worth approaching £1.7 billion according to wealth assessments, Flacks brings retail, industrial and property investment experience to the proposed acquisition. Previous attempts to acquire UK retailers Laura Ashley and Poundworld ultimately proved unsuccessful as both companies entered administration.
The investor emphasized his commitment to long-term ownership of British Steel, distinguishing his approach from private equity models: “We’re structured for enduring commitment without shareholder pressures. Complex turnarounds define our investment philosophy.”
Neither Flacks Group nor the Department for Business and Trade provided additional comments regarding ongoing negotiations. British Steel representatives have not publicly addressed the potential acquisition.
