The sale of British Steel to Jingye is to be finalised next week, after the Chinese industrial firm sent contract offers to 3,200 staff and told 400 they were no longer needed.

Nearly 10 months after British Steel collapsed into insolvency, a rescue deal is on the verge of completion. Staff who are to be made redundant have been told this will take effect when the transaction completes on Monday.

There had been uncertainty over the deal, pending a verdict from the French government, which has expressed opposition to a Chinese company buying British Steel’s Hayange plant.

The factory is a strategic national asset because it supplies track to France’s rail network. The risk that the government might veto Hayange transferring to Chinese ownership was seen as a potential obstacle to Jingye’s purchase, because the plant is one of the few profitable parts of British Steel.

But with little sign of a decision from the French government, the deal is expected to proceed anyway, with Jingye expected to pay £70m and invest a further £1.2bn.

About 3,200 staff were sent new contracts on Monday, while 100 are moving to the UK-based Barrett Steel, which is buying parts of British Steel in a separate deal.

A further 400 were informed during meetings that they would be made redundant on Monday, assuming the sale went ahead.

Those who will lose their jobs were later informed via a letter from the accountancy firm EY, which is managing the sale as “special manager” working for the government’s Insolvency Service.

The letter, a copy of which was seen by the Guardian, reads: “Jingye has informed us that unfortunately, at present, it is not in a position to issue you a contract of employment. However, should that change in the coming days, Jingye will be in contact to discuss possible opportunities.

“In the event that the sale does not complete, while we would attempt to secure alternative purchasers for [British Steel’s] subsidiaries, business, assets and sites, there is no certainty of achieving a sale and it will risk a closure of the business.”

Staff who were warned they would be out of a job from Monday were told to keep showing up for work for the rest of this week or risk losing redundancy payments and holiday pay.