London, Apr 22 (PTI) Indian steel major Tata Steel has filed a billboard court claim within the UK against British Indian steel tycoon Sanjeev Gupta led GFG Alliance, which owns Liberty Steel, over alleged missed payments from a purchase dating back to 2017.
Liberty Steel had stepped in to accumulate Tata’s Speciality Steels business employing quite 1,700 people in Yorkshire, Lancashire and therefore the West Midlands in an estimated 100 million pounds deal, which Tata Steel announced as complete in May 2017.
Now, it’s emerged that payments are missed therein transaction leading to Tata launching proceedings against Liberty Speciality Steels, Liberty House Group PTE and Speciality Steel UK all parts of GFG Alliance, The Daily Telegraph’ first reported.
As this is often now a lively case we aren’t making any comment, a Tata Steel spokesperson said on Thursday.
GFG Alliance, already under considerable pressure because it finds how out of a financial crisis triggered by the collapse of its main backer Greensill Capital, declined to discuss the lawsuit but issued an update on its ongoing refinancing efforts.
While most of our major businesses are performing well, a number of our businesses within the UK have suffered as a result of COVID-19 and therefore the collapse of Greensill Capital has meant there’s less capital support for our UK businesses while we seek new financing to exchange Greensill, a GFG Alliance spokesperson said.
While that takes place, we are undertaking significant self-help measures with the support of our customers and suppliers to make sure we manage cash carefully and still operate. We continue constructive discussions with a variety of stakeholders on mechanisms that might provide the short term capital support our UK businesses need so as to guard jobs and therefore the supply chain while refinancing takes place, the spokesperson said.
The UK government has said that it continues to interact with the corporate and trade unions in search of solutions to save lots of thousands of jobs.
In his most up-to-date set of broadcast interviews earlier this month, Gupta had promised there would be no plant closures under my watch and addressed the thousands of steelworkers employed by his company to mention that they’re like his family and he won’t hand over on them.
The steel tycoon had widely been hailed as a saviour of British steel a couple of years ago, when Liberty Steel acquired a flurry of struggling UK plants, including parts of Caparo Industries when NRI industrialist Lord Swraj Paul’s UK units went into administration in 2015.
Greensill Capital, mired in controversy since it filed for insolvency last month, was the most funder for this acquisition spree and provided billions of pounds of support using controversial supply chain financing. Credit Suisse, a serious investor in Greensill, has also launched winding-up petitions in court against GFG companies because it tries to protect against potential losses.
Liberty had claimed an initial GBP 20-million investment programme to spice up output by repairing and upgrading mothballed machinery, adding new equipment and generating a complete of 300 new jobs soon after it acquired Tata’s Speciality Steels business four years ago.
Speciality Steels is an operation of the very best international calibre with highly-skilled people. We’re investing to make sure this business can capitalise on growth opportunities and reclaim its leading position within the market, Gupta said at the time.