GFG funding to help it restart UK EAF mill

The United Kingdom-based GFG Alliance says it will “inject £50 million of new funding” into its Liberty Steel UK (LSUK) operating unit to enable the restart of LSUK’s Rotherham, England, electric arc furnace (EAF) mill.

“The provision of funding will set the platform to refinance LSUK operations in full [and] support the Restructuring and Transformation Committee (RTC)’s work of creating a profitable, restructured and focused business,” states the company.

The company’s RTC was established this spring. “The injection of £50 million of shareholder funds into Liberty Steel UK is an important step in our restructuring and transformation,” states Jeffrey Kabel, GFG chief transformation officer and a member of the RTC.

Adds Jeffrey S. Stein, chief restructuring officer and head of the RTC, “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.”

GFG, which acknowledges being on a “path to recovery following the collapse of its main lender Greensill [Capital] in March,” also has provided updates on its other business units.

In the United States, the company’s Peoria, Illinois, EAF mill and downstream facilities earned more than $28 million in the first half of this year, “up strongly from $5.8 million last year,” says the firm. GFG says steel volumes increased by around 40,000 tons, “buoyed by strong markets.”

In Australia, the company says it is has agreed to a debt restructuring with Credit Suisse Asset Management (CSAM) for LIBERTY Primary Metals Australia (LPMA), which comprises its integrated mining and basic oxygren furnace (BOF) steel business and coal mine in that nation.

On the continent of Europe, Liberty says its Galati, Romania, BOF mill enjoyed its “best quarterly result since 2008” in the quarter that ended June 30 of this year. In the Czech Republic, its Ostrava BOF mill for the quarter ended June 30 enjoyed its best quarterly performance since 2011, according to GFG.

States Sanjeev Gupta, executive chair of GFG Alliance, “I’d like to thank all our stakeholders – government, union representatives, customers, suppliers and of course our employees and the local community – for the support they’ve shown GFG Alliance as we managed our way through the challenges created by the Greensill collapse.”

He continues, “GFG’s injection of funding to restart the Liberty Steel UK operations is an important step on our road to creating a sustainable U.K. business. It will allow time to prove the operations can run efficiently which will enable us to finalize longer debt restructuring.”