Beijing (AFP)

Chinese steel group Jingye confirmed Monday that it is in talks to buy British Steel, which was bankrupt in May.

A spokeswoman for the Chinese group told AFP that Jingye's president was currently in the UK for talks on the fate of British Steel. She did not provide further details.

Five thousand jobs are at stake, largely in the giant steel complex at Scunthorpe in north-east England.

The Financial Times said last week that Jingye planned to increase production to more than 3 million tons per year, against 2.5 million previously, and improve equipment to make them more energy efficient in particular.

According to the British daily, the Chinese group said that for British Steel to become profitable again, it would be necessary to "lower the costs".

British Steel, number two in the UK behind Tata Steel, was forced into bankruptcy in May for lack of sufficient liquidity and after failed talks with the government on a fresh injection of new money.

He had put his financial difficulties on behalf of Brexit, whose uncertainties plague steel demand of its European customers.

Based in Shijiazhuang, Hebei, the province that surrounds Beijing, Jingye produces iron and steel but has also invested in real estate and tourism.

According to its website, the private group has assets valued at 39 billion yuan (5.05 billion euros) and has 23,500 employees.

European steelmakers have recently questioned Chinese competition for their difficulties.

In May, the European Steel Association (Eurofer) called on the EU to come to the rescue of the sector, explaining that the European market was being invaded by cheap Chinese steel following the imposition of punitive tariffs last year by the United States.

According to the British press, Jingye is not alone in the bid to buy British Steel: Liberty House, industrial conglomerate Sanjeev Gupta, would also be in the ranks.

The search for a savior for British Steel has been going on for months and has been the subject of twists: a project of recovery by the pension fund of the Turkish army Oyak did not materialize at the end of a exclusivity period a few days ago.

© 2019 AFP