|Graham Honeyman (CEO)|
James Tate (CFO)
Steel ingot and bar
|Services||Bespoke heavy engineering|
Sheffield Forgemasters International (commonly called just Forgemasters or Sheffield Forgemasters) is a heavy engineering firm located in Sheffield, South Yorkshire, England. The company specialises in the production of large bespoke steel castings and forgings, as well as standard rolls, ingots and bars.
The company was established in 1983 from the merger of Firth Brown and British Steel Corporation's River Don Works forging operations, as a public company. The company can trace its heritage back to the start of the steel industry in Sheffield in the early 19th century. The firms of Vickers, Cammell Laird, and Armstrong Whitworth were all nationalised to form British Steel in the 1960s. Their buildings now dominate the Brightside area of East Sheffield. Forgemasters' main building is from the Victorian era.
The company has had a chequered history due to the cyclical demand for specialist forgings and castings. After being placed into administration in 2003, in 2005 it was the subject of a management buyout. Forgemasters has not paid a dividend since 2005. A Chinese steel-maker has expressed interest in investing in Forgemasters.
On 19 January 2016 the company unveiled plans to consult on “up to 100 redundancies across all its divisions” out of nearly 800 staff. Chairman Tony Pedder explained that “The storm clouds which seem to gather periodically over the steel and steel-related sectors are once again evident. Of particular concern has been reduced activity in the traditional oil and gas sector, with oil prices down to a level that is deferring much potential new investment." The announcement was made as the company published accounts for the 18 months to December 2014, which showed a loss for the first time since the management buyout in 2005, of £9.4m.
In 2016 Forgemasters obtained a £30 million loan from US bank Wells Fargo, underwritten by UK's nuclear submarine programme contractors BAE Systems, Babcock International and Rolls-Royce, in view of Forgemasters' vital role in the nuclear submarine programme. The underwriting arrangements are due to expire in July 2019.
The company specialises in forged and cast parts for suppliers to the engineering, nuclear, oil, petrochemical, and process industries worldwide.
The company has the American Society of Mechanical Engineers N-stamp accreditation for critical nuclear components, having produced major components for the Astute class submarines and the civil nuclear industry, including Sizewell B, the UK's only pressurised water reactor.
Sheffield Forgemasters currently has the capacity for pouring the largest single casting (570 tonnes) in Europe. The two forging presses in use can exert a pressure of 3,500 tonnes and 10,000 tonnes on a billet of steel. The 3,500 tonne press was installed in 2010 to replace a 1,500 tonne press which dated back to 1897 and was originally steam powered, and after several upgrades became hydraulically operated.
2007 Sheffield floods
The company was severely affected by the 2007 United Kingdom floods, when the nearby River Don flooded the works with several feet of water, but after a cleanup effort Forgemasters was back in action within weeks of the devastation.
On 17 March 2010, Lord Mandelson announced that the UK Government would loan the company £80 million at a low 3.5% interest rate towards the design and building of a new 15,000 ton forging press (together with other investors). The press, intended to give Forgemasters the ability to manufacture ultra-large forgings for the nuclear power industry, would allow the UK to use home-manufactured components during the building of proposed new nuclear power plants in the country. According to The Engineer, as of 2010, there was only one other manufacturer in the world, Japan Steel Works, with the adequate presses and certification able to manufacture all the required ultra-large forgings, however the World Nuclear Association stated that very heavy forging capacity was also operating in China and Russia, and was under construction in France and South Korea.
Following the United Kingdom general election, 2010, held on 6 May, the new Government announced a Treasury review of all Government decisions on funding since 1 January, aimed at reducing the country's budget deficit in response to the preceding financial crisis and concerns over sovereign debt, which led to a period of uncertainty about the expansion's future. On 17 June 2010 Chief Secretary to the Treasury Danny Alexander announced the cancellation of 12 projects totalling £2 billion agreed to by the previous Labour government, including the £80 million loan to Sheffield Forgemasters. The Secretary of State for Business, Innovation and Skills Vince Cable explained the reason was that the project required very large loans and promised extraordinary rates of return with little risk investment by Sheffield Forgemasters, and given the financial situation the government could not support this. Forgemasters' chief executive stated that the project was not economic using private finance, and was unlikely to go ahead without government loans.
In an interview with BBC Radio Sheffield, Deputy Prime Minister Nick Clegg said the Government may reconsider loaning the company money for expansion. However, in 2011, following the Fukushima Daiichi nuclear disaster, the company decided to no longer try to finance a 15,000 ton forging press due to uncertainty about the future of nuclear energy. On 31 October 2011 the UK Government announced new lending of up to £36m to the firm, as part of £950m of investment nationwide from the Regional Growth Fund for a variety of equipment in areas like the melt shop, forge and the machine shops.
Role in Iraqi supergun scandal
On 11 April 1990, HM Customs & Excise in Middlesbrough seized parts of what were believed to be a massive 'supergun' on a ship bound for Iraq. It was revealed that parts of the gun had been manufactured by Forgemasters who stated that they had been told that the pipes were to be used in a petrochemical project.
- Sheffield Forgemasters International History: 20th century Sheffield Forgemasters International
- "Steel jobs saved in firm buyout". BBC News. 28 July 2005. Retrieved 13 March 2016.
- Kleinman, Mark (17 March 2018). "UK industrial giants push for Sheffield Forgemasters overhaul". Sky News. Retrieved 17 March 2018.
- "Sheffield Forgemasters to cut up to 100 jobs as steel industry decline continues". The Guardian. 19 January 2016.
- "Steel crisis: Sheffield Forgemasters latest to cut jobs". BBC News. 20 January 2016.
- "Forgemasters to pump up capabilities?". World Nuclear News. 3 September 2008. Retrieved 2010-06-24.
- Stuart Nathan (22 October 2013). "Power struggle: developing the UK's nuclear manufacturing capacity". The Engineer. Retrieved 12 March 2016.
- Forgemasters back with 'never again' warning Sheffield Telegraph
- Sheffield Forgemasters invests £6m as demand soars Sheffield Telegraph
- Forgemasters place UK at forefront of nuclear power manufacturing Sheffield Forgemasters International
- Sheffield Forgemasters gets £80m state loan to make parts for nuclear industry The Daily Telegraph
- Angela Smith (23 June 2010). "Budget Resolutions And Economic Situation". Hansard. House of Commons. HC Deb, 23 June 2010, 4:37 pm, c360.
The loan would have earned a 3.5% interest rate, and would have involved Westinghouse taking a stake in the company and giving a guarantee of forward orders.
- Sheffield Forgemasters' nuclear ambition, Jon Excell, The Engineer, 28 April 2010
- "Heavy Manufacturing of Power Plants". World Nuclear Association. 18 March 2010. Archived from the original on 2010-04-01.
- City's anxious wait for where axe falls Sheffield Telegraph
- MP demands swift Government decision over Forgemasters money Sheffield Telegraph
- Coalition government axes £2bn of projects BBC News
- Transport and health projects halted as Government backs down on £10bn commitments The Daily Telegraph
- Sheffield Forgemasters' £80m nuclear parts loan axed BBC News
- Government axes Labour's 'breathtakingly cynical' £80m loan to Sheffield Forgemasters Yorkshire Post
- Vince Cable (23 June 2010). "Budget Resolutions And Economic Situation". Hansard. House of Commons. HC Deb, 23 June 2010, 1.14 pm, c310.
What was a very highly geared project promised extraordinary rates of return to the private promoter. We looked carefully at all the evidence, and the project clearly had positive aspects, but we decided that in the circumstances of a Government with highly constrained public finances, we could not support it.
- "We won't give up yet, vows Forgemasters". Yorkshire Post. 17 June 2010. Retrieved 4 February 2013.
Private equity would take the whole of the shareholding away from Forgemasters and put it in the hands of somebody else... That's not just my shares (49 per cent) or the other directors, 65 per cent of the shop floor own the shares in the company. The amount of money to put in to fund the press would more or less have to absorb the whole of the shareholding. The reason why we went to the government is the interest rates were reasonable. Bank interest rates are very high therefore we would have to make huge profits every year in order just to pay off interest on the debt. This is why we needed support from the government."
- "Sheffield Forgemasters loan 'could be revisited' - Clegg". BBC News. 17 December 2010. Retrieved 17 December 2010.
- Elizabeth Rigby (20 April 2011). "Sheffield Forgemasters poised to shun funds". Financial Times. Retrieved 2 November 2011.
- Clegg visits Forgemasters plant The Press Association
- "Sheffield Forgemasters gets up to £36m from government". BBC. 31 October 2011. Retrieved 2 November 2011.
- Exports by U.S. Aided Iraq 'Super Gun,' House Banking Chief Says The New York Times