Piggy Bank

Exalibur Steel - the Port Talbot management team leading a buyout of Tata Steel's UK business - has said it will not take on the company's considerable pension obligations.

Alongside commodities firm Liberty House, Excalibur is one of the leading bidders for the business. It is currently in talks with banks and the government over a £300 million buyout package, but Stuart Wilkie, the Port Talbot boss leading Excalibur ruled Tata's £485m pensions deficit as part of any deal.

Mr Wilkie said: “We want to be a steel company, not a pension company that makes steel ... The pension [liability] for us is off the table."

Business secretary Sajid Javid said talks were ongoing between the government, trustees, the Department for Work and Pensions and ministers to tackle the issue of the huge pension deficit. But Mr Wilkie said Excalibur had not been included in any discussion with the government about the deficit.

Mr Wilkie also indicated that Excalibur would be looking set up a defined-contribution pension scheme in place of the current defined-benefit scheme, which typically gives out more. With the government likely to take a 25% stake in the takeover, Excalibur is also looking for the government to underwrite a method that would allow workers to pool funds and contribute to 10% of the deal.

“At this point we would look at some form of share save scheme. We had them under the ownership of Corus and it was a very successful proposition — a lot of people used it as a basic savings mechanism," Mr Wilkie said.