British Steel Limited’s £120 Million Short Term Bridge Financing

Ashurst has advised the Department for Business, Energy & Industrial Strategy on a commercial agreement with British Steel Limited, the second-largest steelmaker in the UK.

The short term bridge was valued at approximately £120 million.

The agreement has been entered into to enable British Steel to comply with its 2018 obligations under the EU Emissions Trading Scheme (ETS). The ETS requires heavy industry and power producers to obtain and surrender allowances equal to their level of carbon emissions on an annual basis. Some of these allowances have in previous years been allocated as free allowances to certain industries by the UK. However, the European Commission has suspended the UK’s ability to allocate free allowances until the Withdrawal Agreement under negotiation with the European Union has been ratified. Until this week British Steel had not surrendered sufficient allowances for 2018 and therefore faced a potential liability of over £600 million if it did not comply.

The Ashurst team was led by Giles Boothman (Picture) and included partners Derwin Jenkinson and Kerion Ball, counsel Don Brown and senior associate Richard Bulmore.

Involved fees earner: Kerion Ball – Ashurst; Giles Boothman – Ashurst; Don Brown – Ashurst; Richard Bulmore – Ashurst; Derwin Jenkinson – Ashurst;

Law Firms: Ashurst;

Clients: Department for Business, Energy & Industrial Strategy;