Turkey's military pension fund has entered into exclusive talks for the takeover of British Steel.
Ataer, which invests funds for the Turkish Armed Forces Assistance Fund - or Oyak - already owns almost 50 per cent of Turkey's biggest steel producer, Erdemir.
Oyak is the largest shareholder of steel company Erdemir in its own country.
OYAK has reached a provisional agreement to buy the company based in Scunthorpe, North Lincolnshire where 3,000 people work.
British Steel, which is now owned by private investment company Greybull Capital LLP, has said its workforce, and an additional 20,000 employees in the supply chain, are at risk of losing their jobs if a suitable buyer can not be found.
Both parties are now in the stages of finalising the purchase, with Oyak's accountants taking over the books.
The Official Receiver, a government agency responsible for the auction process, said the talks were for the whole of British Steel. "I would like to thank all employees, suppliers, and customers for their continued support which has been essential to get to this point".
The acquisition of British Steel would enable the Turkish group to "increase its effectiveness in the value chain and the weight of value-added products in its final product portfolio", said Toker Özcan, head of OYAK's Mining Metallurgy Group, adding that "our priority will be to increase the production capacity and to invest in clean steel production".
The collapse of the company could have spelled disaster for Scunthorpe and its steel workers if no buyer had been found.
'The UK has a long and proud history of steel manufacturing and I am committed to a modern and sustainable future for the industry, that is productive and supports a skilled and highly valued workforce'.
"Whilst the coming weeks will be crucial for hammering out the detail and successfully completing a sale, the outlook is now extremely positive".
Earlier this year the government provided a £120m loan to British Steel in order to help meet its carbon credit obligations under the European Union emissions trading system (ETS), after the steelmaker fell foul of rule changes triggered by the delay to the UK's Brexit date.
The Business Secretary, Andrea Leadsom, described the news as an "important step" to secure the future of British Steel.
Harish Patel, national officer for steel at the Unite union, said: 'The overwhelming feeling of the 5,000 workers at British Steel is one of relief'.
"Ataer requiring more steel for its "downstream" plants, means production in the United Kingdom could increase post-sale, which would be very good news for the domestic workforce", John Cullen, business recovery partner at accountancy firm, Menzies, said.
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