Sheffield steel: Speciality Steel reveals potential buyer in winding up hearing
A giant steel firm has had a stay of execution after it revealed it had a potential buyer.
A court hearing to decide a winding up order against Liberty Speciality Steels UK was adjourned until mid-July to “finalise options,” including a sale of the business.
The action was brought by Harsco Metals Group over unpaid debts.
It is the latest delay in deciding the fate of the debt-ridden company, which employs 1,500 at steelworks in Rotherham and Stocksbridge, Sheffield.
Jeffrey Kabel, Liberty Steel chief transformation officer said the adjournment give them time to “finalise options,” including a sale of the business, while continuing to try to restructure debts.
He added: “We remain committed to finding the right solution that preserves electric arc furnace steelmaking in the UK, a vital national asset serving strategic supply chains.
“SSUK has been involved in complex debt restructuring since the collapse of Greensill Capital in 2021 restricting its access to capital. However, like all steel producers in the UK, SSUK has faced long-standing competitiveness challenges dating back decades.
“Throughout Liberty’s ownership of SSUK its shareholder (Sanjeev Gupta) has consistently supported the business, investing nearly £200 million in loss funding and salaries over the past four years, even as significant portions of the business remained inactive.”
The firm owes more than £600m following the collapse of lender Greensill and a downturn in demand. Many workers have been on furlough for months due to a lack of orders.
Sanjeev Gupta is CEO and chairman of GFG Alliance whose subsidiaries include Liberty House Group, owner of Speciality Steel UK.
She added: “He has run out of road; his chaotic ownership must end now. Our Stocksbridge Speciality Steels site needs new, competent ownership to maximise its potential, so that the business has a real chance for success.”
SSUK owes £289m to lender Greensill Capital, which collapsed in 2021, £288m to sister companies, £10m to another, unnamed, lender and £7.7m in tax to HMRC, according to court documents filed in December.
It also owes £23m to an unknown number of unsecured creditors including suppliers.
Harsco’s winding up petition is supported by five other creditors: Swallownest Engineering Company, Kings of Rotherham and Intralinks Inc - which have a presence in Rotherham - C & J Welding & Fabrication of Sheffield and Rs Components, according to Caseboard website.