TATA STEEL TAKES LIBERTY STEEL TO COURT IN UK OVER MISSED PAYMENTS
LONDON: Indian steel major Tata Steel has filed a commercial court claim in the UK against British Indian steel tycoon Sanjeev Gupta led GFG Alliance, which owns Liberty Steel, over alleged missed payments from an acquisition dating back to 2017.
Liberty Steel had stepped in to acquire Tata’s Speciality Steels business employing more than 1,700 people in Yorkshire, Lancashire and the West Midlands in an estimated £100 million deal, which Tata Steel declared as complete in May 2017. Now, it has emerged that payments have been missed in that transaction resulting in 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 now an active case we are not making any comment,” a Tata Steel spokesperson said on Thursday.
GFG Alliance, already under considerable pressure as it finds a way out of a financial crisis triggered by the collapse of its main backer Greensill Capital, declined to comment on the lawsuit but issued an update on its ongoing refinancing efforts.
“While most of our major businesses are performing well, some of our businesses in the UK have suffered as a result of Covid-19 and the collapse of Greensill Capital has meant there is less working capital support for our UK businesses while we seek new financing to replace Greensill,” a GFG Alliance spokesperson said.
“While that takes place, we are undertaking significant selfhelp measures with the support of our customers and suppliers to ensure we manage cash carefully and continue to operate. We continue discussions with a range of stakeholders on mechanisms that would provide the short-term working capital support our UK businesses need in order to protect jobs,” the spokesperson said.