Steel tycoon Gupta rules out bailout, UK closures

Liberty Steel’s Sanjeev Gupta smiles outside the company’s Liberty Steel processing mill in Dalzell, Scotland April 8, 2016. — Reuters pic
Liberty Steel’s Sanjeev Gupta smiles outside the company’s Liberty Steel processing mill in Dalzell, Scotland April 8, 2016. — Reuters pic

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LONDON, April 1 — Indian-British billionaire Sanjeev Gupta today ruled out a bailout or factory closures for his steelmaking group GFG Alliance after the collapse of corporate finance firm Greensill.

The remarks come after the UK government earlier this week refused GFG a rescue package totalling £170 million (RM970 million).

There is growing concern in Britain about the future of GFG and Liberty Steel, which together employ 5,000 people domestically and 35,000 worldwide.

GFG Alliance had been Greensill’s biggest customer.

“I am not waiting for anybody to come to the rescue. We will help ourselves but of course all help from everybody is always welcome,” Gupta told the BBC.

He admitted that his company owed “many billions” to Greensill, but insisted that no facilities would face closure.

“Our overall global operations are profitable,” the GFG founder said.

“We have refinancing offers, we will refinance, and we will support our UK business also,” he said.

“None of my steel plants under my watch will be shut down.”

GFG has operations in more than 35 countries across the world, and annual global revenues of about US$20 billion according to its website.

“Our plants are conserving cash. Many of our customers are coming forward and giving us large orders, prepayments and so on, the market needs our material and we are working with financiers to refinance,” added Gupta.

Greensill specialised in short-term corporate loans via a complex and opaque business model that ultimately sparked its declaration of insolvency last month.

Gupta said there are “positive discussions” with Greensill’s administrator.

“It makes no sense for them or any of the creditors to destroy jobs, or more importantly to destroy value, because that is the value which will give them the recovery,” he said.

“So I am very confident that we will find short-term solutions to our own efforts, and we will find long-term solutions for refinancing.” — AFP

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