The government is willing to take a 25% stake in Tata Steel's UK business in a bid to rescue the steel industry and save thousands of jobs.
The UK and Welsh governments also said a support package worth "hundreds of millions of pounds" will be offered to potential buyers.
Here's what we know about the development.
What has the government offered?
The money will be made available on commercial terms, and it is expected that all, or the large majority, will be through the provision of debt financing.
The government's announcement comes after Business Secretary Sajid Javid visited Mumbai to meet Tata's chairman Cyrus Mistry on Tuesday.
Javid was accused of not reacting quick enough to the crisis when Tata announced it was selling its UK operation.
Senior managers at the Port Talbot plant have also put together their plan for a management buyout of the site.
The scheme is led by Stuart Wilkie, the Managing Director of Tata's strip products business.
Is anyone interested in buying the business?
ITV News understands "more than 50" formal expressions of interest into the business have been made by investors.
A spokesperson for the prime minister played down talk of "part nationalisation".
If we were to take an extra stake it would be a minority one with the aim of supporting the purchaser in delivering a long term future for the business, we are certainly not seeking to be controlling the company.
Shadow Business Secretary Angela Eagle said the government's promise of investment is a step forward, but more still needs to be done.
Whether you call this 'co-investment' or part-nationalisation, it is a long-overdue recognition of the need for Government support for the sale process. Labour and the steel unions have been calling for action for weeks; this appears to be a step forward. But this alone will not be enough to save the steel industry. The Government must ensure Tata allow enough time for a suitable buyer to be found and they must reassure the customer base and supply chain. Crucially, they need to address the underlying challenges facing the industry; energy costs, business rates, procurement, and most of all, the illegal dumping of Chinese steel."
A steel worker told ITV News the government's involvement could safeguard the industry's UK future.
A spokesman for metals trading business Liberty House added that the development was encouraging and confirmed it would help its team analyse the Tata opportunity available.
The UK Government announcement today is interesting and encouraging and will help our team with their analysis of the Tata opportunity, which is underway at the moment.
Our business editor writes:
Parts of the business are undoubtedly attractive. Tata has guaranteed contracts to supply the car-industry, construction and packaging firms. But parts are heavily loss-making and look a very hard sell.
Read more from Joel Hills.