Tata Steel is reportedly suing Liberty Steel to recover unpaid debts for missed payments in the £100 million flagship takeover of Tata’s specialty steel business by Liberty back in 2017. Tata will pursue cases against Liberty House Group PTE, Liberty Speciality Steels, and Speciality Steel UK, according to reports.
Liberty Steel’s parent GFG Alliance is currently recovering from the downfall of its prime backer, Greensill in the beginning of March this year. Sanjeev Gupta, the owner of GFG Alliance, came out as one of the biggest steel magnates from the 2017 acquisition.
Since Greensill’s collapse, there has been speculation about Liberty Steel’s future and the thousands of jobs that were affected in the course, requiring the local government to take some measures to protect the company from the fallout.
GFG’s request to the UK government, seeking financial support for £170 million to keep its UK operations going, has supposedly been rejected by Kwasi Kwarteng, Business Secretary. However, the government has vowed to preserve Liberty Steel in some form, claiming that it is continually engaging with the company as well as the broader local steel industry and trade unions.
Last month, Sanjeev Gupta also faced legal action from two more investors, who reportedly began legal proceedings to wind up parts of the Liberty Steel owner’s metals group. Citigroup, on behalf of Credit Suisse, began legal action to claim unpaid debts from GFG Alliance.
After the Greensill collapse last month, GFG Alliance, which has around 5,000 workers, has reportedly been struggling to fund its UK operations, and plans on ‘vigorously’ defending itself.
Mr. Gupta was quoted saying that their global operations are lucrative, and they have refinancing offers, which he plans to capitalize on, and that GFG Alliance will also support the UK business.
Liberty Steel has 12 steel plants operating in the UK, including the ones at Motherwell, Newport, and Rotherham, where it employs a workforce of 3,000 people.
Source credits: https://www.bbc.co.uk/news/business-56840180