Tata Steel successful in the first round of legal battle

CORUS owner Tata Steel has won the first stage of a legal battle against the consortium that pulled out of a 10-year deal to buy steel from the Teesside Cast Product plant in Redcar which shut last year with the loss of 700 jobs.
Tata and the international consortium fell out in 2009 when the latter pulled out of the deal in the fourth year – wiping out almost 80% of TCP’s order book overnight.
The move threatened the future of the plant, which was mothballed last May after a spirited fight to rebuild the order book and cut costs. Around 700 of the 1,700 workers were laid off as a result.
Tata said it had won “a partial final award” in its battle with the consortium. “The arbitral tribunal, amongst other things, found that the off-takers did not validly terminate their off-take agreements,” the company said.
“The arbitration proceedings are being held under the auspices of the International Court of Arbitration (and) will now move to the next phase of determining the amount of damages.”

Tata estimates it lost as much as £150m due to the early termination of the agreement.
The company said falling demand in Europe had contributed to a 4.8% drop in third-quarter sales to 5.9 million tonnes.
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