The majority of collapsed steel business Aartee Bright Bar will be bought by Barrett Steel in a £13 million rescue deal – but the firm’s Dudley site will close.
It comes after the West Midlands-based company fell into administration in February.
Administrators for Aartee Bright Bar said its hot rolled steel business in Dudley is not being acquired as part of the takeover, meaning it will be wound up with 45 redundancies and the site’s closure.
Barrett will, however, take on the group’s distribution business in Rugby, Bolton, Newport and Southampton, its Bright Bar business operating out of Willenhall and freehold and leasehold properties at the sites.
Aartee Bright Bar is the UK’s largest distributor of steel products and was closely linked to metal tycoon Sanjeev Gupta and his GFG Alliance steel business.
Mr Gupta’s GFG Alliance business, which runs Liberty Steel, failed in his bids to take control of the business after it fell into insolvency.
Michael Magnay, managing director at Alvarez & Marsal, said: “This substantial investment from Barrett Steel is a vote of confidence in the business and the wider UK steel industry.
“We are grateful to the employees and creditors for their support and understanding during this process, and to Barrett Steel for its commitment to the deal.”
Marcus Tyldsley, chief financial officer at Barrett Steel, said: “We’re delighted to share that we’re acquiring a new business as part of our ongoing expansion strategy.
“Our focus is on delivering exceptional service to our customers, and we’re confident that this acquisition will help us achieve that goal.
“As new owners, we’ll prioritise the safety and wellbeing of our employees, and work collaboratively with our new team to bring fresh ideas and perspectives to the table.
“We’re excited to welcome our new colleagues to the Barrett Steel family and look forward to a successful future together.”