Metals magnate Sanjeev Gupta faces a parliamentary inquiry into the crisis at Liberty Steel
Metals magnate Sanjeev Gupta faces a parliamentary inquiry into the crisis at Liberty Steel.
MPs on the House of Commons business committee want to examine why the steel maker was pushed to the brink of collapse after the largest lender to Gupta’s business empire went bust in March.
The 49-year-old tycoon was dubbed the ‘saviour of UK steel’ when he began buying struggling plants in 2013. His collection of companies, called the GFG Alliance, employs 5,000 people in the UK, including 3,000 at Liberty Steel.
Probe: The 49-year-old tycoon was dubbed the ‘saviour of UK steel’ when he began buying struggling plants in 2013
But GFG has been battling for survival since Greensill Capital went bust last month.
Greensill, which was advised by ex-prime minister David Cameron, was the biggest lender to GFG through complex supply chain financing.
But questions are being raised about whether GFG companies lent money to one another. There have also been reports of invoices from businesses that claim they have never dealt with the industrialist. Business Secretary Kwasi Kwarteng refused a request for a £170m bailout last month, saying its finances were too opaque to trust that the money would stay in Britain.
Gupta is scrambling to find alternative finance. It is not clear whether he will appear before the business committee, as the scope of the inquiry is still being determined.
Tory MP Richard Fuller, a member of the committee, said: ‘Select committees are a useful way of asking probing questions to powerful people, so it’s right it goes ahead. We obviously don’t know what will happen in the near future with Liberty and to be fair to the wider GFG Group they are pursuing refinancing.
‘But there are questions on the group’s historical financing. It would help the future stability of steel in the UK if there was the opportunity for more transparency on these issues, even if GFG is successful in securing private financing support.’
Gupta is in Dubai after going there to escape the UK’s third lockdown. It has emerged his father, Parduman, has changed his country of residence from Britain to India. Parduman owns Simec Group, the renewable energy arm of GFG.
A committee spokesman said: ‘The committee is actively considering an inquiry examining the challenges facing Liberty Steel and the wider issues raised for the future of the steel industry. Further details will be announced in due course.’ A spokesman for GFG declined to comment.