UK steel magnate Sanjeev Gupta steers clear of David Cameron-Greensill row

Liberty Steel owes ‘many billions’ to collapsed lender at heart of lobbying scandal

FILE PHOTO: Liberty Steel's Sanjeev Gupta smiles outside the company's Liberty Steel processing mill in Dalzell, Scotland, Britain April 8, 2016. REUTERS/Russell Cheyne/File Photo
Powered by automated translation

The owner of a UK steel company on the brink of collapse denied having any interactions with former prime minister David Cameron.

Mr Cameron is under pressure over his dealings with failed lender Greensill Capital, a business in which he has a financial stake, and unsuccessfully tried to lobby the government on its behalf to secure a taxpayer-backed loan.

Liberty Steel – which employs about 5,000 UK workers and more around the world – is struggling to refinance its operations after Greensill's collapse last month.

Sanjeev Gupta, Liberty Steel’s owner, said his company owed “many billions” of pounds to Greensill but he expected other financiers to back him.

Asked whether Mr Cameron lobbied on behalf of Liberty, Mr Gupta told BBC Radio 4's Today programme: "I've not had any interactions with him, no."

The UK government said this week it was considering all options to keep Liberty Steel going, including nationalisation.

But ministers rejected a request from Mr Gupta’s group for £170 million ($233m) of emergency funding, and said the internal operations of the company were too opaque and it was not clear if any funding would stay in the UK.

Mr Gupta claims to have huge interest from financiers willing to refinance the debt owed to Greensill.

“Actually we have a huge amount of interest from new financiers who are willing to back us, who are willing to refinance Greensill,” he said.

“Given the situation, this sort of thing takes time and hence we need to find short-term solutions.”

He said it was natural that lenders wanted to protect their position and said there were positive discussions with Grant Thornton, the administrator for Greensill.

“It makes no sense for them or any of the creditors to destroy jobs, but more importantly to destroy value because that is the value which will give them the recovery,” he said.

Liberty runs 12 steel plants in the UK, including at Rotherham, Motherwell and Newport, and employs 3,000 people. A further 2,000 work for Mr Gupta’s holding company in other UK metals businesses.

Citigroup, acting on behalf of Credit Suisse, started legal action in London's insolvency court to recoup unpaid debts from Mr Gupta's company.

But the steel magnate said no steel plant would close.

“None of our steel plants under my watch will be shut down,” he said.

Meanwhile, the UK’s main opposition Labour Party called for an inquiry into Mr Cameron’s lobbying work for Greensill.

Mr Cameron pressed the government – including reportedly sending Chancellor Rishi Sunak a text message – for an emergency loan for Greensill.

Mr Sunak referred him to Treasury officials, who denied the request.

The former prime minister is reported to have told friends he was set to earn $60m from shareholdings in the lender.