Liberty secures funding for Rotherham restart in October

GFG Alliance will inject £50 million ($68m) of new funding into Liberty Steel UK (LSUK) to enable the restart of the UK unit’s core Rotherham electric arc furnace. Production ramp-up will begin this month, with a view to reaching a 50,000 tonnes/month rate “as soon as possible”, a GFG spokesperson tells Kallanish.

The move sets the foundation for LSUK’s longer-term refinancing and expansion of Rotherham’s capacity to create a 2 million tonnes/year “GREENSTEEL” plant, the firm says. “There is a significant opportunity to expand recycling of scrap steel for growth markets such as infrastructure and engineering,” it adds.

Investment plans in Rotherham, reviewed by industry consultants, will boost production capacity, increase employment and introduce new products. “LSUK’s downstream operations remain core to LSUK’s asset base and will provide downstream capacity for Rotherham’s output, enabling increased shift opportunities at the Thrybergh and Scunthorpe mills,” GFG observes.

The fresh funding will also enable LSUK’s speciality steel division, SSUK, formed of Stocksbridge, Narrow Strip and Performance Steel, to run focused production campaigns for key customers.

Funds will be allocated to LSUK through a new separate corporate entity Liberty Capital. LSUK will run as normal with funding for growth in working capital approved through Liberty Capital. This arrangement will ensure fast and effective deployment of the £50m in initial funds in the UK, enabling LSUK to restart its operations, GFG says.

“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,” says chief restructuring officer Jeffrey S. Stein.

Adam Smith Germany