Amid gas support muddle
Steelworks to restart after Liberty seals funding
Liberty Steel has raised funds
Hopes for the future of two steelworks have risen after the GFG Alliance said on Sunday it had agreed a £50 million debt restructuring deal with Credit Suisse.
The funding from the Swiss bank will allow it to restart its Rotherham and Stocksbridge plants in South Yorkshire, and safeguard 600 jobs.
GFG’s Liberty Steel said production will start in October with a plan for output to reach 50,000 tonnes per month as soon as possible.
The workers at the two plants are currently on 80% pay, funded by Liberty, after the UK government’s furlough scheme ended on 30 September.
There has been concern that dramatic rises in the price of energy would prevent Rotherham from reopening this month.
GFG, owned by commodities tycoon Sanjeev Gupta, has been seeking to refinance its web of businesses in steel, aluminium and energy after supply chain finance firm Greensill Capital filed for insolvency in March.
A debt restructuring for its Australia assets will allow GFG to make a “substantial upfront payment” to Greensill Bank and Credit Suisse, with the balance paid in instalments until the new maturity date of June 2023, a statement from GFG said.
Kwarteng ‘talks’ challenged
The rescue deal came as Business Secretary Kwasi Kwarteng was drawn into a dispute with the Treasury after he claimed he was in talks with the Chancellor over possible support for energy intensive industries.
failed to commit any additional government help for businesses struggling amid record gas prices.
Some industries – including steel – have warned firms could be forced to shut down operations.
Mr Kwarteng said he was working closely with the chancellor over possible support for energy intensive sectors – but a Treasury source denied there were any talks.
The Business Secretary said domestic customers would not see a change to the energy price cap this winter.