Liberty Steel has hired a team of specialist directors to its board to accelerate the group’s overhaul and refinancing after its backer Greensill Capital went bust.
The company said the four new directors will make up a new restructuring and transformation committee, which will be given independence to restructure Liberty and either fix or sell off under-performing divisions.
Concerns were raised over Liberty’s future after Greensill collapsed in March.
Greensill was the largest lender to steel magnate Sanjeev Gupta’s GFG Alliance – the parent company of Liberty Steel – and its failure put in jeopardy some 5,000 jobs in the UK.
Liberty Steel appoints new restructuring committee as firm seals deal for Australian steelworks
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Sanjeev Gupta’s Liberty Steel has today announced that it will set up a restructuring committee made up of four new directors in a bid to refinance the group after the collapse of Greensill in March.
In a statement, the firm, which is a subsidiary of the tycoon’s GFG Alliance, said that the new execs would “be given full autonomy to restructure Liberty’s operations to focus on core profitable units, and either fix or sell underperforming units”.
The appointments come after ministers criticised the conglomerate for a lack of transparency over its operations, which they said was the reason a bid for a £170m bailout was turned down.
No one can accuse Liberty Steel boss Sanjeev Gupta of giving up the ghost. Faced with the collapse of his main lender Greensill and a refusal by Business Secretary Kwasi Kwarteng to provide £170million of rescue loans, he is hanging on by his fingertips.
In the latest moves to shore up his global empire, GFG Alliance, he is reported to have found funding for his Australian operations and has brought in experts to see what can be salvaged in terms of steel making in the UK.
The rescue team may be assisted by surging steel prices across the world as Covid retreats, demand surges and production bottlenecks develop.
Greensill was the largest lender to steel magnate Sanjeev Gupta’s GFG Alliance – the parent company of Liberty Steel – and its failure put in jeopardy some 5,000 jobs in the UK. Liberty has been forced to seek urgent financing, with the UK Government rejecting its appeal for a £170 million bailout in March. Liberty said the director appointments mark a “step forward” in its response to the Greensill collapse. It said: “This restructuring combined with the continuing strength in steel and iron ore markets will present a solid basis for the future of Liberty. ” The firm added that the committee will work with the board and advisers to “negotiate an amicable solution with Greensill’s administrators and other stakeholders which protects value and provides the best outcome for all stakeholders”.