The move will safeguard more than 4,000 jobs, but workers are being asked to accept a pay cut and less generous pension arrangements.
Greybull said it was arranging a £400m investment package as part of the deal and the business will be rebranded as “British Steel” once the deal is completed in eight weeks.
The new business would include the Scunthorpe works, two mills in Teesside, an engineering workshop in Workington, a design consultancy in York, a mill in Hayange, France, and sales and distribution facilities.
Speaking on the deal Business Secretary Sajid Javid said, “Today’s announcement is a step in the right direction for the long-term future of British steel manufacturing in Scunthorpe.
“This point wouldn’t have been reached without the efforts of all those involved especially the high skilled workforce and local management. We will now look through the detail and stand ready to provide funding on a commercial basis if required.
“The UK and Welsh Governments are working tirelessly to ensure that we can now reach a deal for Port Talbot and the other Tata sites across the UK. This agreement sends positive signals to any potential investor for the rest of Tata’s UK business.”