Gupta's Liberty Steel to restart operations, in talks with UK government

LONDON: Tycoon Sanjeev Gupta's Liberty Steel UK plans to restart steelmaking next week and continues to seek new funding after its main financial backer Greensill Capital went into insolvency, it said on Monday.

Gupta's conglomerate GFG Alliance said earlier this month it was in talks with administrators of Greensill over a standstill agreement. On Monday GFG said those negotiations were ongoing and also said that Liberty Steel was still seeking support from the UK government.

In an insolvency filing earlier in March, Greensill said that GFG, which is its largest client, had warned in February that it would "collapse into insolvency" if the supply chain finance firm stopped providing it with working capital.

GFG, however, said on Monday that its steel and mining operations in Europe and Australia were booking record profits and had adequate funding.

In Britain, Liberty Steel was working with customers on payment terms that would bring in cash earlier while looking for additional working capital facilities, it said.

"Liberty Steel UK continues in constructive discussions with the UK government on measures to supplement these efforts," GFG said.

On Sunday, the Financial Times reported that British ministers had rejected a request from Gupta for a 170 million pound ($234.40 million) emergency loan to prevent GFG Alliance from collapsing.

Monday's statement also said that Liberty's British steel operations planned to restart operations on around April 6, but did not say when they had closed.