Liberty Steel: Bosses announce restructure to save plants in Sheffield and Rotherham

The firm wants to ‘significantly reduce’ debt at its Speciality Steel UK business using a process for companies in financial difficulty.

If agreed by creditors, it is the best way to recover the business and avoid insolvency, it says. And it will have ‘no impact’ on employees.

It comes after hundreds of steelworkers at plants in Aldwarke, Rotherham, and Stocksbridge, were left fearing for their jobs after not being paid on time last month.

The unprecedented delay came as most of the workforce at both sites is furloughed due to a lack of orders.

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Liberty has blamed its financial woes on a ‘severe market downturn’, high UK energy costs and debts from the collapse of lender Greensill Capital in 2021. At the time, Liberty Steel founder Sanjeev Gupta said they owed the financial firm ‘many billions’.

Now, bosses say Speciality Steel has secured support for the restructure from major customers ensuring its order book ‘remains stable’ and it can begin repaying debts.

But first, creditors must vote for the plan.

Jeffrey Kabel, chief transformation officer at Liberty Steel Group, said: “After making significant progress to stabilise the business and refocus it on high value specialist products, we’re now addressing the debt position of the company to create a stronger speciality business going forward.

“Our plan, which is backed by customers, is the best route forward for all stakeholders and we’re confident in winning the support of our creditors for the essential actions required to complete SSUK’s recovery.”

SSUK makes speciality steel for the aerospace, defence and energy sectors.

Alasdair McDiarmid, assistant general secretary of Community union, said: “We acknowledge Liberty’s plan to reduce debts and welcome the company’s commitment there will be no impact on employees.

"Liberty’s Speciality Steel businesses are strategically important for our country and their long-term future must be secured.

"As well as supporting thousands of highly skilled well-paid jobs, they produce world leading green steels for Britain’s defence, aerospace and energy industries.

"All stakeholders must play their part to protect jobs and safeguard these priceless national assets.”