Steel magnate Sanjeev Gupta is set to seek court approval to restructure the majority of his remaining UK operations.
Sky News reported that Liberty Steel, Mr. Gupta’s privately-owned company, will introduce a restructuring plan for its UK Speciality Steel division (SSUK) on Monday, aimed at significantly reducing its debt.
Begbies Traynor, considered the insolvency practitioner, has been appointed to oversee the restructuring plan to be implemented under Part 26A of the 2006 Companies Act. There has been an opinion that there would be no impact on the 1,500 employees of the Speciality Steel business in the UK.
Under the plan, Liberty Steel’s creditors would face certain concessions, requiring approval from 75% of them for the court to approve the restructuring.
In a statement issued, Jeffrey Kabel, Liberty Steel group chief transformation officer, said: “After making significant progress to stabilise the business and refocus it on high-value specialist products, we’re now addressing the debt position of the company to create a stronger specialty business going forward.”
If the move goes ahead, it would follow a series of restructuring and cost-cutting measures by Gupta’s empire in recent years, as per reports.
The SSUK division operates across sites such as Rotherham in South Yorkshire and Bolton in Lancashire, producing precision-engineered steel products for industries including aerospace, automotive, and oil and gas.
The restructuring of SSUK coincides with ongoing discussions between Chinese-owned British Steel and the government regarding a potential aid package. Whitehall sources described the claims that the company might receive up to £2 billion in government funding as “completely inaccurate.”