Sanjeev Gupta has today hit out at that the “aggressive tactics” of his steel empire’s creditors were putting tens of thousands of jobs at risk.
Since the collapse of supply chain financiers Greensill, Gupta’s GFG Alliance has been teetering on the brink of insolvency, having had a £170m bailout bid rejected by ministers.
The firm, which employs 35,000 people around the world, including 5,000 people in the UK, is in the process of negotiating replacement funding with new backers.
But writing in the Times this morning, the steel tycoon said that the actions of some of GFG’s creditors were causing “unwanted headwinds”.
“Financial institutions with investments connected to Greensill are now trying to bring claims against us. We will of course robustly defend our legal position, including in the courts if necessary. Our clear priority must be to protect the long-term future of our people and local communities”, he wrote.
“These creditors are at risk of destroying their own chance of recouping value by taking these knee-jerk actions. They undermine profitable businesses and ultimately put at risk thousands of skilled, industrial jobs in communities with limited alternative employment opportunities.
“They are also damaging the resilience, profitability and environmental performance of UK businesses which rely on our steel and aluminium products, and are critical to the wider UK economy.”
Gupta, who has been under intense scrutiny due to GFG’s financing arrangements, said that he accepted that the firm’s practices needed an overhaul.
“I’m ready to change. So is the GFG Alliance. We understand that the way we used to finance our operations needs to be overhauled, and we will address our challenges head on.”
However, despite the firm’s looming debt, the billionaire said that most of its businesses were “sustainable”, although the situation is most concerning in the UK.
“We have our challenges, and perhaps the greatest here in the UK, where our businesses have faced a dramatic squeeze from the aerospace and automotive markets, where demand for some products has fallen by as much as 60 per cent through Brexit, Covid-19 and now Greensill”, he wrote.