Steel group Meridian in last-ditch talks to avert collapse
21 March 2019, 11:14 | Updated: 21 March 2019, 13:26
One of Britain's biggest steel stockholding businesses is in last-ditch talks to avoid collapse just days after MPs accused the government of neglecting the wider steel industry.
Sky News has learnt that Meridian Metal Trading, which employs about 170 people, could appoint administrators on Friday as emergency talks with prospective buyers go to the wire.
Meridian imports, deals and processes steel sheet and coil, and supplies nearly 250,000 tonnes of steel to hundreds of customers annually.
Sources said the company, which is based in Dudley in the West Midlands, had been in discussions with prospective investors for several weeks.
In the last fortnight, Meridian has filed two notices of intention to appoint administrators amid talks with Duferco, an industrial conglomerate with a significant presence in the global steel market.
The talks with Duferco have now cooled, and a solvent sale looked unlikely ahead of the expiry of Meridian's second insolvency notice at midnight on Thursday, according to insiders.
Duff & Phelps, the professional services firm which handled the insolvency of BHS, has been advising Meridian's board on the process and would handle any administration process.
Even without a solvent sale, a pre-pack administration which salvages many of Meridian's jobs remains a realistic possibility, the sources added.
Meridian has faced growing pressure on its business amid difficult conditions in international steel markets and a backdrop of escalating trade tensions.
In its accounts for the year 31 May 2017, the company said it "faces pressure in respect of a struggling global steel market".
Its accounts for the year to 31 May 2018 are almost a month overdue, according to Companies House.
This week, a damning report by MPs on the Business, Energy and Industrial Strategy select committee blamed the government for failing to deliver a sector deal for the steel industry.
Rachel Reeves MP, the committee chair, said: "On steel, the government should get back to the table and talk to the industry to get a sector deal done.
"Having made the steel industry jump through hoops in efforts to get a deal, the government should now deliver on its side of the bargain."
Founded in 1987, Meridian's largest creditor is understood to be Secure Trust Bank, which was reported nearly a year ago to have agreed a £35m borrowing facility with the company.
Meridian could not be reached for comment, while Duff & Phelps declined to comment.
(c) Sky News 2019: Steel group Meridian in last-ditch talks to avert collapse