ASW, based in Cardiff, is one of the largest users of recycled steel in Europe, but went into receivership in July with 650 staff being made redundant.
Commenting on the development, Welsh Assembly economic development minister Andrew Davies said: “Today’s announcement that the major Spanish steel maker Celsa is the prospective buyer of ASW’s assets is a very important step forward. We now know formally who we are dealing with and that a final decision will be made in January.”
He added: “First Minister Rhodri Morgan and I will be discussing progress later today with a senior director of the company to hear at first hand Celsa’s next steps.
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