UK Government Wants Mr Gupta to Control Liberty Steel
British media Business Live reported that UK’s Secretary of State for Business Energy and Industrial Strategy Mr Kwasi Kwarteng said that Mr Sanjeev Gupta should still be allowed to control Liberty Steel despite concerns over poor corporate governance and opaque financing at his company. He believes the GFG Alliance could raise the funds to save the firm but contingency plans are being drawn up should the Government need to step in. Taking questions from the BEIS select committee, Mr Kwarteng said “If for whatever reason the refinancing doesn’t work out we have options. We are considering options of how we can take things forward. I have always said that we’ve got to wait and see what happens because the nature of the collapse of the financing, the nature of the state of the business is actually in will determine Government’s action. It could well be that there’s another buyer and that’s something we would have to investigate.”
He also explained that a commitment had been made to allow GFG to continue to run the business, saying “Even though GFG and the Gupta family group had financial difficulties, if Mr Gupta could refinance those assets it’s only right for us to give him the chance to do that, to intervene now would breach that commitment. Previously GBP 170 million was asked for from the Government, which was rejected. He wants to find private financing with his lenders and we have to see that process through.”
MPs pointed out that the Government had provided support to Tata Steel in the past to save jobs, but the minister said the proposals from the rival firms were substantively different. He told “There was much more clarity and assurance that any support we provided would stay in the plant and stay in the UK. There was far less transparency in regards to Mr Gupta’s request than there was with Tata’s and the situation is completely different. GFG had an opaque financing structure.”
The minister insisted that Liberty Steel still has a viable future in the UK but needed investment to realise its potential.