Her Majesty’s Revenue and Customs (HMRC) is attempting to force a division of Sanjeev Gupta’s steel empire into insolvency, placing further doubt on the future of the business.
According to Sky News, the taxman has filed a winding-up petition against the speciality steels division of Liberty Steel.
Gupta’s business Britain’s third-biggest steel producer and is responsible for employing over 2000 people.
The petition is expected to be heard late next month.
It remains unclear how much Gupta’s speciality steel business, which operates plants in Rotherham and Stocksbridge, owes HMRC.
However, one source told the broadcaster it was in the tens of millions of pounds.
The tax authority’s decision to file a winding-up petition follows the expiry late last year of a moratorium against such actions by company creditors.
The measure was introduced by the government to give company bosses greater protection during the pandemic.
Gupta’s financial problems have been mounting since his request for £170m from British taxpayers was rejected in May last year.
Since then, the tycoon has embarked on several rounds of restructuring, which have included a number of disposals around the world.