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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Liberty Steel U.K. (LSUK) (London, England) looks set to receive a life-saving cash injection of £50 million (US$68 million) following the agreement of a financial restructuring plan between its parent company GFG Alliance (London, England) and Credit Suisse Asset Management.
The money will enable the restart of the core Rotherham electric arc furnace (EAF) and bring hundreds of workers back to work. Rotherham is the hub for the company's GREENSTEEL initiative to recycle scrap metal using electric arc furnaces powered by renewable and low-carbon energy. According to the company, producing steel from recycled materials emits less than a third of the emissions compared with primary steel production using traditional blast furnaces. The company is also exploring newer technologies such as hydrogen steelmaking to remove emissions from primary steel production via Direct Reduced Iron furnaces that can feed EAFs. The Rotherham site in northern England employs about 660 staff. The company employs roughly 3,000 across its steel businesses in the U.K.
"There is a significant opportunity to expand recycling of scrap steel for growth markets such as infrastructure and engineering," the company stated. "Production ramp-up will commence in October 2021 with a plan to reach 50,000 tonnes per month as soon as possible. The restart of operations will enable colleagues to return to work, setting the platform for LSUK's longer-term refinancing and delivery of its plan to expand Rotherham's capacity, creating a two million tonnes per annum GREENSTEEL plant."
The restructuring deal with Credit Suisse covers a debt restructuring for Liberty Primary Metals Australia (LPMA), made up of the integrated mining and primary steel business at Whyalla and its coking coal mine at Tahmoor. GFG Alliance was on a rollercoaster of major acquisitions in recent years until the beginning of this year, when its main financing partner Greensill Capital (London) became insolvent, leaving the company with a huge network of businesses but not enough money to run them. Up until Greensill, collapsed the company had purchased distressed steel and aluminium--up to 50 in a few years--including those formerly owned by British Steel in the U.K., some of ArcelorMittal's (NYSE:MT) (Luxembourg, Luxembourg) European steel assets, Rio Tinto's (NYSE:RIO) (London) Dunkerque aluminium smelter in France, Australia steel producer Arrium (Sydney, Australia), and U.S. steel wire and rod producer Keystone Consolidated Industries (Dallas, Texas). The company, owned by British Indian businessman Sanjeev Gupta, employs 35,000 people globally.
Industrial Info is tracking US$3.3 billion in projects associated with the company, most of which are hanging in the balance pending the company's financial recovery.
Click on the image at right to view a map showing the GFG Alliance assets around the globe from Industrial Info's Key Account Locator.
The Key Account Locator is available to all subscribers to Industrial Info's Global Market Intelligence (GMI) database.
In related news, U.K. Steel, the representative body of the country's steel sector, has called on the government to urgently help with soaring energy prices that have heavily impacted the industrial sector. "Energy price spikes and lack of Government action has created a hostile environment for industrial investment in the U.K.," said U.K. Steel director general, Gareth Stace. "For U.K. Steel and its members, the key measure of success for this proposal is whether it places U.K. steel producers on a levelling playing field on energy costs compared to the European counterparts. Key to this will be a mechanism that shields steel producers from the extreme wholesale price spikes we've seen in recent weeks. If any package delivers less than this and we still continue to pay more for energy than French and German steel producers, we remain at a competitive disadvantage. Steel producers here in the U.K. will continue to have to pause steel production, will be less efficient, and will lose margins and market share."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
The money will enable the restart of the core Rotherham electric arc furnace (EAF) and bring hundreds of workers back to work. Rotherham is the hub for the company's GREENSTEEL initiative to recycle scrap metal using electric arc furnaces powered by renewable and low-carbon energy. According to the company, producing steel from recycled materials emits less than a third of the emissions compared with primary steel production using traditional blast furnaces. The company is also exploring newer technologies such as hydrogen steelmaking to remove emissions from primary steel production via Direct Reduced Iron furnaces that can feed EAFs. The Rotherham site in northern England employs about 660 staff. The company employs roughly 3,000 across its steel businesses in the U.K.
"There is a significant opportunity to expand recycling of scrap steel for growth markets such as infrastructure and engineering," the company stated. "Production ramp-up will commence in October 2021 with a plan to reach 50,000 tonnes per month as soon as possible. The restart of operations will enable colleagues to return to work, setting the platform for LSUK's longer-term refinancing and delivery of its plan to expand Rotherham's capacity, creating a two million tonnes per annum GREENSTEEL plant."
The restructuring deal with Credit Suisse covers a debt restructuring for Liberty Primary Metals Australia (LPMA), made up of the integrated mining and primary steel business at Whyalla and its coking coal mine at Tahmoor. GFG Alliance was on a rollercoaster of major acquisitions in recent years until the beginning of this year, when its main financing partner Greensill Capital (London) became insolvent, leaving the company with a huge network of businesses but not enough money to run them. Up until Greensill, collapsed the company had purchased distressed steel and aluminium--up to 50 in a few years--including those formerly owned by British Steel in the U.K., some of ArcelorMittal's (NYSE:MT) (Luxembourg, Luxembourg) European steel assets, Rio Tinto's (NYSE:RIO) (London) Dunkerque aluminium smelter in France, Australia steel producer Arrium (Sydney, Australia), and U.S. steel wire and rod producer Keystone Consolidated Industries (Dallas, Texas). The company, owned by British Indian businessman Sanjeev Gupta, employs 35,000 people globally.
Industrial Info is tracking US$3.3 billion in projects associated with the company, most of which are hanging in the balance pending the company's financial recovery.
Click on the image at right to view a map showing the GFG Alliance assets around the globe from Industrial Info's Key Account Locator.The Key Account Locator is available to all subscribers to Industrial Info's Global Market Intelligence (GMI) database.
In related news, U.K. Steel, the representative body of the country's steel sector, has called on the government to urgently help with soaring energy prices that have heavily impacted the industrial sector. "Energy price spikes and lack of Government action has created a hostile environment for industrial investment in the U.K.," said U.K. Steel director general, Gareth Stace. "For U.K. Steel and its members, the key measure of success for this proposal is whether it places U.K. steel producers on a levelling playing field on energy costs compared to the European counterparts. Key to this will be a mechanism that shields steel producers from the extreme wholesale price spikes we've seen in recent weeks. If any package delivers less than this and we still continue to pay more for energy than French and German steel producers, we remain at a competitive disadvantage. Steel producers here in the U.K. will continue to have to pause steel production, will be less efficient, and will lose margins and market share."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
