A PS50 million ($A93 million) cash injection is being made by Liberty Steel, to safeguard hundreds of jobs in the UK.
The announcement, affecting its plant in Rotherham, South Yorkshire, is part of a wider restructure of GFG Alliance, Liberty’s owner, which was forced to seek funding when its key lender, Greensill Capital, collapsed.
The cash will allow the plant to reopen after being closed for several months.
“I’m pleased to report a significant advance in GFG Alliance’s global restructuring,” chief restructuring officer Jeffrey S Stein said.
“The debt restructuring we have agreed for Liberty Primary Metals Australia gives the business clarity and stability, and secures a clear recovery plan for creditors.
“The funding we are injecting to Liberty Steel UK puts it in a strong position for business transformation and debt restructuring.”
Sanjeev Gupta, executive chairman of GFG Alliance, said: “Through the hard work and determination of our team, our Australian integrated operations are now profitable and performing the best they have for many years.
“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.”
Local MP and Labour’s shadow defence secretary John Healey said: “This is a breakthrough after months while Liberty workers have been left in limbo.
“Liberty is at the heart of steelmaking in Rotherham, and we’ve been holding our breath for the working capital to restart production.
“But PS50 million won’t be enough for long, so full long-term refinancing for Liberty UK now needs to follow rapidly from the deal for Liberty Australia.”
Story originally appeared on fca.org.uk