Introduction to the Crisis

One of the last remaining steel companies in the UK, Specialty Steels UK (SSUK), part of the Liberty Steel Empire of the Metal Tycoon Sanjeev Gupta, has been driven into mandatory liquidation. The company employs almost 1,500 people at locations in Rotherham and several other locations in South Yorkshire.

Impact and Background

Behind Tata Steel and British Steel, SSUK is the third largest steel producer in the country. Negotiations had been in progress to save the company, but they seem to have been unsuccessful. The decision to bring SSUK into obligatory liquidation has been deemed irrational, especially considering the support from the world’s largest asset manager to resume operations and restore creditors.

Reaction from GFG Alliance

Jeffrey Kabel, Chief Transformational Officer from GFG Alliance, stated that the plan presented to the court would have secured new investments in the British steel industry, protected jobs, and built a sustainable operational platform under a new governance structure with independent supervision. Instead, the liquidation will impose longer uncertainty and considerable costs for taxpayers for settlements and associated expenses, despite the availability of a commercial solution.

Efforts to Save the Company

Liberty has followed all options to make SSUK viable, including efficiency improvements, reorganizations, customer support, several attempts to find a buyer for the business, and intensive negotiations with creditors to restructure Liberty’s shareholder debt of almost 200 million GBP. GFG will continue to advance its offer for the company in cooperation with potential debt and equity partners and present its plan to the official receiver.

Investment and Commitment

GFG continues to believe that it has the ideas, management expertise, and commitment to lead SSUK into the future. Despite many challenges and difficult market conditions, GFG has invested more than 2 billion GBP in the British economy since 2013 to ensure the survival of many GFG companies and secure thousands of jobs that would otherwise have been lost.

Response from Local Authorities

Sarah Champion, the Labor MP for Rotherham, said that GFG’s statement was "full of promises". She added that the special steel manufactured is unique and that the GFG has been exposing the system for almost two years. Strategically speaking, the Liberty Steel government cannot fail, and she is confident that they will do everything in their power to let it thrive.