A Chinese industrial giant is set to come to the rescue of British Steel within days.

After talks with prospective Turkish buyer Altaer collapsed, the Jingye Group has become the leading contender to buy British Steel out of liquidation, with a buyout bid worth a reported £70 million on the table.

Jingye is also set to sweeten the offer with the promise it can also access up to £300 million in loans, indemnities and grants to back its plan to boost production at the Scunthorpe plant by 10 per cent.

Workington's TSP Engineering is a wholly-owned subsidiary of British Steel, but operates as a separate company, and has been unaffected by the liquidation.