UK steel stockholder Meridian Metal Trading has entered administration.

The company has been in talks with its five main suppliers, credit insurers and Secure Trust Bank for months after a potential buyout fell through.

While the creditors and insurers have been supporting the business, they cannot provide fresh credit and the business has been having to prepay for steel, given its lack of cover.

One large trading firm that walked away from a deal to buy the company is keen to take it from administration, and other parties are also assessing the situation.

Meridian is a West Midlands-based decoiler with a nameplate capacity of around 240,000 t/yr across hot-rolled coil, cold-rolled coil and hot-dip galvanised. It has not operated at capacity for some time because of its funding difficulties.