STEELMAKER Corus last night denied reports that a buyer for its Teesside business could be ready to pull out, and moved to quell speculation that the jobs of its 2,000 workers could be in jeopardy.

Speculation yesterday suggested a deal for a majority stake in Corus’s Teesside Cast Products site to be taken by Italian company Marcegaglia – part of a joint venture which agreed to buy the plant – could be about to collapse.

According to reports, Steno Marcegaglia, chairman and founder of the group, was said to have decided that the £328m deal no longer made sense in the light of the crisis in the steel industry, which is set to see output drop by 15 per cent this year, the biggest drop since the end of the Second World War.

Marcegaglia, alongside South Korean company Dongkuk, agreed a memorandum of understanding with Corus in January to complete a deal to take a majority share in the Redcar plant.

The collapse of the agreement could cast doubt on the future of the site’s 2,000 workers.

However, last night, Corus – owned by Indian steelmaker Tata Steel, which bought the company for £6.7bn two years ago – moved to quash the speculation by insisting the deal was still on the table with a view to being completed in the coming months, subject to due diligence.

A spokesman said: “Corus has had no communication from Marcegaglia to say that they wish to discontinue these negotiations.

“A memorandum of understanding is still in place and we have not had any contact from Marcegaglia on the subject.”

The sale of the cast products plant was announced shortly after Corus revealed it would be making 2,500 job cuts across the UK in January, from which the North-East emerged largely unscathed, apart from a potential 47 redundancies at its Northern Engineering Services division, on Teesside.

Vera Baird, MP for Redcar, also moved to offer assurance yesterday, saying: “Corus has told me that the deal to buy the plant is the subject of a memoranda of understanding signed by both parties, due diligence has been proceeding and Corus has not had any word from the others that the situation has changed.

“No doubt talks will continue but, contrary to the impression that might have been made, this is not a jobs emergency at this time.”