Sanjeev Gupta’s GFG Alliance this morning announced it had reached a standstill agreement with Credit Suisse over its Australian steel and coal mining businesses.
The six-week deal will give the conglomerate the time it needs to fully refinance the operations, GFG said in a statement.
Since the collapse of boutique bank Greensill in March Gupta has been scrambling for cash to shore up his crumbling empire, with creditors circling the assets.
The firm has already agreed to sell off a number of sites, including its speciality steelworks in Stocksbridge in the midlands, to pay off its lenders.
Today’s agreement covers the Whyalla steelworks in south-west Australia, and its coking coal mine at Tahmoor, GFG said.
“GFG Alliance and Credit Suisse Asset Management (CSAM) have agreed a formal standstill agreement with regard to Liberty Primary Metals Australia (LPMA),” GFG said in a statement.
“The six week standstill agreement will enable GFG Alliance to complete full refinancing of LPMA, expected to complete within this time frame.”
The Credit Suisse had previously disclosed some $2.3bn worth of loans exposed to financial and litigation uncertainties within the funds, with some $1.2bn of its assets related to GFG.
The announcement comes after GFG subsidiary Liberty Steel’s finance chief yesterday admitted that some of its larger businesses were “challenged”.
Speaking to the business select committee yesterday, a visibly uncomfortable Anton Krull failed to answer many of the questions posed to him by MPs.