GFG Alliance Announces Major Restructuring for Refinancing
GFG Alliance and LIBERTY Steel Group’s Restructuring and Transformation Committee has provided an update on the restructuring of GFG’s steel businesses. The developments help pave the way for a refinancing which will enable GFG to pay back creditors following the collapse of its main lender Greensill Capital. This in turn will allow GFG to refocus its business, protect jobs and develop further its remaining assets. Chief Restructuring Officer Mr Jeffrey S Stein said “We are aware of the significant challenges facing the group but are pleased that we are making good progress to refinance, repay creditors and refocus the group on our core assets. Much remains to be done but we are optimistic that a vibrant, well-funded, profitable and sustainable business will emerge as we systematically restructure and transform the group.”
The Restructuring and Transformation Committee was established on 5th May 2021 to restructure LIBERTY’s operations to focus on core profitable units, and with a brief either to fix or to look at the option of selling underperforming units. Since May, the Restructuring and Transformation Committee has evolved a strategy for LIBERTY’s future which will see the company focus on its primary metal production hubs and associated downstream units, and renewable energy developments, to support its GREENSTEEL vision. The restructuring will support GFG’s progress on refinancing of the group, which has been boosted by the strength of core assets and record steel, aluminium and iron ore prices.
In its reformed state, LIBERTY will be focused on core business units, including InfraBuild and LIBERTY Primary Metals Australia in Australia and the LIBERTY Ostrava and LIBERTY Galati steelworks in Europe. These will continue to be operationally and commercially developed to improve their generation of cash and profits. The plan also incorporates a restructured and refocused UK business as well as more closely integrating the European downstream steel plants into LIBERTY’s major businesses.
As part of that process GFG Alliance and the Restructuring and Transformation Committee have already achieved the following
GFG Alliance and Credit Suisse Asset Management have agreed a formal standstill agreement with regard to LIBERTY Primary Metals Australia which will enable the business to complete full refinancing
Progressing the refinancing of LIBERTY Primary Metals Australia, with White Oak Global Advisers LLC. The refinancing will be sufficient to pay out LIBERTY Primary Metals Australia’s Greensill debt in full.
Agreement on a framework with Greensill Bank’s administrator for positive direct engagement to achieve an amicable resolution
Submission of refinancing memoranda to interested parties for LIBERTY Steel Continental Europe, including major primary production hubs in Ostrava and Galati
Development of new business plans, asset strategy and management structure for LIBERTY Steel UK