A PACKAGE of support worth hundreds of millions of pounds will be made available on commercial terms to potential buyers of Tata Steel.

The package would see the Government prepared to take stake of up to 25 per cent in Tata Steel's UK operations to support sale. 

The business department said it was preparing a support package "worth hundreds of millions of pounds" available to potential buyers.

Business Secretary Sajid Javid said the money would be offered on commercial terms, but the government would not take any control over the business.

Redcar MP Anna Turley, said: “I am pleased the government have learned the lessons from their failure in Redcar and are now willing to put support in place to help secure a future for Tata’s UK operations and the thousands of jobs it sustains.

"Hopefully this offer to potential buyers is sufficient to protect those jobs and that the government also respond to the industry’s concerns about challenges like energy costs and business rates which are helping to fuel this crisis.

"I only wish Ministers had possessed the same commitment and determination last year by mothballing the blast furnace in Redcar and allowing time for the buyers interested in the profitable coke ovens to prepare bids. Instead industrial assets have been left to crumble and we have been left with huge clean-up costs.”

At least two potential buyers have shown interest in buying Tata, which includes pipe mills in Hartlepool.

One option is a management buyout backed by the chief of Tata's Port Talbot factory, the UK's largest steel operation.

Steel company Liberty House, owned by Sanjeev Gupta, has also said it was interested in buying parts of the business.

Mr Javid said last week that the government was prepared to support a credible buyer with a finance package, including loans.

Thursday's announcement followed another visit to Mumbai by Mr Javid to meet Tata's chairman Cyrus Mistry where the minister said progress on the sales process had been made.

Tata has said that it would give the government and potential buyers time to arrange a rescue package, but that it did not want to prolong the uncertainty for customers and workers.