Sanjeev Gupta’s Liberty Steel has announced plans to sell its aerospace and special alloys steel business in Stocksbridge, South Yorkshire, as part of a restructuring deal as it tries to ensure its survival.
Liberty has been in crisis since March after the collapse of its key lender Greensill Capital.
“Liberty Steel Group announces that following very constructive and productive meetings at the weekend in Dubai, Sanjeev Gupta and his newly-formed Restructuring and Transformation Committee are in advanced discussions with Credit Suisse Asset Management (CS) to reach a formal standstill agreement on its Liberty Primary Metals Australia business while refinancing is completed that will repay CS out in full,” said Liberty Steel.
“Both parties also made significant progress in agreeing a framework to resolve GFG Alliance’s remaining exposure with CS.
“This work includes identifying a positive solution which will allow Liberty to complete the restructuring and refinancing of its UK operations, protecting thousands of jobs and supporting the fulfilment of its vision to be a leader in the decarbonisation of the UK steel industry.
“As part of this restructuring Liberty will look to sell its aerospace and special alloys steel business in Stocksbridge, which while being a unique, high quality business servicing marquee customers in aerospace, auto and other highly engineered applications, is not core to the Greensteel vision of Liberty.
“This sale will allow Liberty to focus on developing its Rotherham plant including its electric arc furnaces into a competitive 2 million tonnes recycled Greensteel plant, one of the largest in Europe.
“The plant will make use of some of the millions of tons of steel scrap currently exported by the UK to make more of the quality steel needed in the UK, which is currently being imported.
“Liberty has also already commenced the formal sale process of Liberty Aluminium Technologies and Liberty Pressing Solutions, working collaboratively with the main customers of these plants to find a sustainable home for these quality businesses, which are also non-core to Liberty’s vision of decarbonised Greensteel.
“A formal sale process for Stocksbridge and its downstream plants, the narrow strip mill at Brinsworth and Performance Steels at West Bromwich will be launched shortly.”
GFG’s advisers Alvarez & Marsal will run both processes.