Liberty Steel’s chief transformation officer has described Speciality Steel UK (SSUK) being pushed into compulsory liquidation by the high court in London as “irrational”, Kallanish learns.
Jeffrey Kabel says in a statement that the decision “especially when we have support from the world’s largest asset manager to resume operations and facilitate creditor recovery is irrational.”
The company will now enter administration. It has been placed under the control of special managers appointed by the government’s official receiver.
SSUK previously announced a restructuring in November 2024 and had a winding up petition adjourned in the same month. In May this year, another hearing was adjourned amid a potential sale. The company employs around 1,450 people within the speciality business.
Kabel adds that the plan Liberty’s parent, GFG Alliance, presented to the court “would have secured new investment in the UK steel industry, protecting jobs and establishing a sustainable operational platform under a new governance structure with independent oversight.”
“Instead, liquidation will now impose prolonged uncertainty and significant costs on UK taxpayers for settlements and related expenses, despite the availability of a commercial solution,” he says.
Liberty says it has pursued all options to make SSUK viable, including efficiency improvements, reorganisations and customer support. There have been several attempts to find a buyer for the business and intensive negotiations with creditors to restructure debt liabilities. The company notes that its shareholder has invested nearly £200 million ($268m).
The company says it will now continue to advance its bid for the business in collaboration with prospective debt and equity partners and will present its plan to the official receiver.
“GFG continues to believe it has the ideas, management expertise and commitment to lead SSUK into the future and attract major investment. GFG’s other significant business interests in the UK remain unaffected,” it adds.
In a separate statement, industry association UK Steel says the company provides vital steelmaking capacity in aerospace, defence and power generation. The association welcomes the government’s move.
UK Steel director general Gareth Stace says: “UK Steel welcomes the government’s recognition of the importance of the Liberty Speciality Steel assets and hopes that a new owner is found quickly and can inject the investment and working capital required to return production volumes to previous levels.”
“The assets produce high quality, specialist steels that serve high value markets. The low production levels of recent years have left significant holes in the domestic supply chain that have been filled by imports. We hope to see these holes quickly filled by UK-made steel,” he adds.
Carrie Bone UK
