A CONSORTIUM which almost caused the collapse of North-East steel making after pulling out of a contract with Tata Steel has agreed to pay £80m compensation.

The then Tata owned Teesside Cast Products (TCP) was mothballed in February last year after the consortium pulled out half-way through a ten-year agreement to take 78 per cent of the steel slab it produced until 2014, blaming the effects of the global economic downturn.

Today it emerged the consortium consisting of Marcegaglia, Dongkuk, Duferco and Ternium Procurement agreed yesterday to pay $130m (£80m) compensation.

Steel making is due to restart after the Redcar plant was bought by Thai firm Sahaviriya Steel Industries (SSI) in March.