Liberty Liège Dudelange Gets Credit Protection
S&P Global Platts reported that Liberty Steel Group’s Liberty Liège-Dudelange has been granted temporary protection from creditors of its Belgian Liège plants and will work in coming days with stakeholders to identify new sources of financing to sustain the company's activities and continuity. Granting of court protection follows Liberty Steel Group's request on April 27 to the Liège Enterprise Court that it should grant a judicial reorganization procedure for its Liège plants. The objective of the Liège-Dudelange PRJ, which applies only to the company's plants at Flémalle and Tilleur in Belgium, is to temporarily protect the company from its creditors, while ensuring the best possible ongoing relationships with them, and ensure the continuity of the company, the Liberty. PRJ will not affect the day-to-day management of the Liège business and the local management team will remain at the helm, benefiting from an initial creditor moratorium to the end of July 2021.
The report quoted a Liberty Steel Group spokesperson as saying that "In the next few days, the company's management team and a Mediator will continue to work collaboratively with stakeholders to identify new sources of financing to sustain the company's activities. LIBERTY will also continue to engage with stakeholders to identify new sources of financing of the Dudelange plant. LIBERTY Liège-Dudelange's first priority remains the welfare of its high quality and highly committed employees and the management team believe that these decisions will offer the best chances for a sustainable outcome for the plants, their employees and their loyal customer base."
Liberty spokesperson also said "LIBERTY Liège-Dudelange, which incorporates two plants at LIBERTY Liège in Belgium and LIBERTY Dudelange in Luxembourg, has faced a significant reduction in working capital support since the collapse of Greensill Capital which has led to ongoing issues with its main supplier of Hot Rolled Coil. It has suffered significant issues with its main supplier of hot rolled coil, impacting its ability to operate at full capacity even after COVID-19 restrictions were lifted and causing supply chain disruptions.”
However, the main supplier of hot rolled coil to Liège-Dudelange steelmaker ArcelorMittal said that it continues to supply to the works under a pre-established contract arrangement.
Dudelange and Liège together have annual production capacities estimated at 1.6 million tonnes of galvanized/coated steel, 300,000 tonne of cold rolled coil and 200,000 tonnes of tinplate
News of the Liège-Dudelange creditor protection follows the late April entry into judicial administration of three French units of Alvance Aluminium, GFG Alliance's aluminum subsidiary.