STEELMAKER Liberty is pumping £50 million into its Rotherham and Stocksbridge plants to help get production back up and running and attract fresh investment to ensure its long term future.
The company announced yesterday that it had set its Australian arm on a firmer footing and planned to invest an eight-figure sum into restarting its paused UK operations — centred on the works at Aldwarke — which it said would encourage new investors.
Wentworth & Dearne MP John Healey welcomed the financial influx but said more still needed to be done.
“This is a breakthrough after months while Liberty workers have been left in limbo,” he said.
“Liberty is at the heart of steelmaking in Rotherham, and we’ve been holding our breath for the working capital to restart production.
“But £50 million won’t be enough for long, so full long-term refinancing for Liberty UK now needs to follow rapidly from the deal for Liberty Australia.
“Only then will Rotherham breathe more easily.”
Liberty, which put production on hold in March, announced the debt relating to its Primary Metals arm in Australia had been restructured with lenders Credit Suisse Asset Management and said the £50 million investment in the UK side of the business would “relaunch Rotherham”.
Jeffrey Stein, Liberty’s chief restructuring officer, said: “The funding we are injecting to Liberty Steel UK puts it in a strong position for business transformation and debt restructuring.
“The next stage in our global refinancing will be in Europe where a significant number of new lenders are expressing interest in refinancing our steel assets.”
Chief transformation officer Jeffrey Kabel said the injection would “help to create sustainable value, ensure that Liberty has the ability to raise and deploy capital quickly in the UK and enable our businesses to demonstrate their potential and agree long term debt restructuring”.
Mr Healey added: “It’s a year since I first met with Sanjeev Gupta on site at Rotherham to discuss Liberty’s future financing and growth.
“He’s proved the company can get new finance agreed with creditors for Australia, now they must do the same for the UK.
“Urgent government action is also needed to deal with the growing crisis for firms hit by the crippling rise in their energy costs.
“British Ministers have so far washed their hands of this growing crisis, when governments in the rest of Europe have stepped in to support their industry, even though their steelmakers have lower energy costs.”
Mr Gupta, executive chairman of Liberty’s parent company, GFG Alliance, said the firm remained committed to recycling metal for reuse — referred to as “greensteel”.
He added: “The funding commitment we’re making at Rotherham will safeguard jobs, enable us to benefit from strong outlook for our core sectors and lay the platform to create a sustainable UK business that will generate skilled jobs in industrial communities.”
South Yorkshire mayor Dan Jarvis also welcomed the announcement, saying: “Steel is a strategic sector for the UK economy and with the right support can have a bright future — providing good jobs and prosperity with the transition to green steel.
“That’s why we need industry, government and trade unions to continue working together to safeguard steel’s future, protecting jobs and businesses in the supply chain for the long-term.”