UK steel plants risk closure on Greensill fallout, says minister

Signage is seen outside the offices of collapsed finance firm Greensill near Warrington, northwest England, on April 12, 2021. — AFP pic
Signage is seen outside the offices of collapsed finance firm Greensill near Warrington, northwest England, on April 12, 2021. — AFP pic

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LONDON, April 13 — Liberty Steel could shut some of its dozen UK plants following the collapse of main financial backer Greensill, Business Secretary Kwasi Kwarteng said today, in a saga engulfing UK politics.

The collapse last month of British company Greensill Capital threatens thousands of jobs, including at Liberty-owned GFG Alliance — the steel empire of Indian-British billionaire Sanjeev Gupta.

British politics has also been hit by the fallout and today Prime Minister Boris Johnson said a review into how Greensill was able to secure UK government contracts will be given the “maximum possible access”.

It comes as pressure mounts on British former prime minister and Greensill adviser David Cameron after the government yesterday announced its inquiry into his lobbying of ministers prior to the company’s collapse.

Today, Kwarteng told a cross-party committee of British MPs that some parts of Liberty Steel could be lost after the government refused a bailout, a decision it has justified owing to GFG’s “very opaque” structure.

“I am very keen to see that these (Liberty) assets, which are good assets, continue to operate and the company continues to operate but we can’t strip Liberty Steel from the wider group under which it sits and, as Mr Gupta says, they have billions and billions of debt,” Kwarteng added.

The UK government last month refused GFG a rescue package totalling £170 million.

Greensill specialised in short-term corporate loans via a complex business model that ultimately sparked its declaration of insolvency. — AFP

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