The owners of British Steel have been branded 'sharks' after it was revealed that the company has gone into administration.

Earlier this week  it was announced that Britain's second-largest steel producer was on the brink of collapse putting thousands of jobs at risk, including hundreds in the North East at sites in Lackenby and Skinningrove.

Politicians in the region have called on the government to intervene and pump money into the business to keep it open.

However, this morning it is believed that Greybull Capital has gone into administration.

A statement from the official receiver confirms that the company was wound up in the High Court this morning.

A statement reads: "The immediate priority following my appointment as liquidator of British Steel is to continue safe operation of the site. I appreciate that this a difficult time for the company’s employees and I want to thank them for their ongoing cooperation.

"The company in liquidation is continuing to trade and supply its customers while I consider options for the business. Staff have been paid and will continue to be employed. The court also appointed Special Managers to assist me with my work and they are engaging with staff and their representatives to keep them informed, as well as contacting British Steel’s customers."

Tees Valley Mayor Ben Houchen has hit out at the company's handling of the steel firm's collapse.

He said: “British Steel’s owners, Greybull Capital, have been complete sharks throughout this tragic process. Greybull offered a measly £1million to save the company, and then expected the taxpayer to cough up while they laughed all the way to the bank.

“It is clear that my request for temporary nationalisation to save 700 jobs has fallen on deaf ears. The Government argue that bailing out a failing company is prohibited under strict EU state aid laws, but I’m not buying it.

The Northern Echo: Tees Valley Mayor Ben HouchenTees Valley Mayor Ben Houchen

“I brought our local airport back into public ownership to prevent closure, and countless other European countries have stepped in save their steel industries to prevent collapse. Hiding behind European Union rules does absolutely nothing to help 700 workers who’ll be worried about their jobs and livelihoods today.

“Yet again the people of Teesside have been shafted by heartless private investors, and a Government completely unwilling to pull their finger out to help local workers.

“This issue is much bigger than party politics and so I have written to every MP and Council Leader in our region to convene an urgent meeting this Friday. As a region, our one and only priority will be to ensure Teesside jobs are protected and the company’s profitable plants at Lackenby and Skinningrove remain open.”

MP Anna Turley, who represents the Redcar constituency in Teesside where a number of British Steel employees are based, tweeted: "This is absolutely gutting. So many people have given everything to try & make British Steel a success.

"My thoughts are with everyone at the Beam Mill, Skinningrove & Scunthorpe today. Trying to get more info on implications & next steps."

And union chiefs are calling for 'cool heads' as the search begins for an alternative buyer.

Roy Rickhuss, the general secretary of the Community trade union said: "This news will heap more worries on workers and everyone connected with British Steel but it will also end the uncertainty under Greybull's ownership and must be seized as an opportunity to look for an alternative future.

"It is vital now that cool heads prevail and all parties focus on saving the jobs.

"In these very difficult circumstances we know the workforce will continue to fight for the business as they have done for so many years.

"We would urge the management, contractors, suppliers and customers to support them in that fight for the future."

Business Secretary Greg Clark, who was born in Middlesbrough, said: "The Government has worked tirelessly with British Steel, its owner Greybull Capital, and lenders to explore all potential options to secure a solution for British Steel.

"We have shown our willingness to act, having already provided the company with a £120 million bridging facility to enable it to meet its emissions trading compliance costs.

"The Government can only act within the law, which requires any financial support to a steel company to be on a commercial basis. I have been advised that it would be unlawful to provide a guarantee or loan on the terms of any proposals that the company or any other party has made.

"This will be a deeply worrying time for the thousands of dedicated British Steel workers, those in the supply chain and local communities.

"In the days and weeks ahead, I will be working with the Official Receiver and a British Steel support group of management, trade unions, companies in the supply chain and local communities, to pursue remorselessly every possible step to secure the future of the valuable operations in sites at Scunthorpe, Skinningrove and on Teesside."