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You can find the current article at its original source at https://www.theguardian.com/business/2025/aug/20/ministers-line-up-plan-to-run-liberty-steel-south-yorkshire-plants-in-administration
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| Ministers line up plan to run Liberty Steel’s South Yorkshire plants in administration | Ministers line up plan to run Liberty Steel’s South Yorkshire plants in administration |
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| Court is shown proposal to secure operations of SSUK, which employs 1,450 people | |
| Business live – latest updates | Business live – latest updates |
| Ministers have lined up special managers to run Liberty Steel’s South Yorkshire operations if they are put into administration, according to a dramatic revelation at London’s high court. | Ministers have lined up special managers to run Liberty Steel’s South Yorkshire operations if they are put into administration, according to a dramatic revelation at London’s high court. |
| The development shows the government is ready to step in immediately to secure the continued operations of the Speciality Steel UK (SSUK), which employs 1,450 people at the group’s operations at an electric arc furnace in Rotherham and another plant in Stocksbridge, both in South Yorkshire. | The development shows the government is ready to step in immediately to secure the continued operations of the Speciality Steel UK (SSUK), which employs 1,450 people at the group’s operations at an electric arc furnace in Rotherham and another plant in Stocksbridge, both in South Yorkshire. |
| Creditors to SSUK are seeking a compulsory winding up order, the high court heard on Wednesday. The company asked to adjourn the hearing to buy time to try to agree a “pre-pack” administration that would allow its owner, the metals tycoon Sanjeev Gupta, to keep control of the insolvent company. | Creditors to SSUK are seeking a compulsory winding up order, the high court heard on Wednesday. The company asked to adjourn the hearing to buy time to try to agree a “pre-pack” administration that would allow its owner, the metals tycoon Sanjeev Gupta, to keep control of the insolvent company. |
| Counsel representing the creditors showed the judge a letter from the Department for Business and Trade detailing that the government had said its official receiver was ready to carry out a sales process if the company entered administration. | Counsel representing the creditors showed the judge a letter from the Department for Business and Trade detailing that the government had said its official receiver was ready to carry out a sales process if the company entered administration. |
| The insolvency and companies court judge Sally Barber said she was minded to give two weeks of extra time to decide what the consequences of each course would be. | The insolvency and companies court judge Sally Barber said she was minded to give two weeks of extra time to decide what the consequences of each course would be. |
| However, after a short pause, the creditors’ counsel then disclosed that lawyers for the government were present in the court. The barrister said he had just been informed that an application for the appointment of a special manager to carry out the administration had already been prepared in draft form. | However, after a short pause, the creditors’ counsel then disclosed that lawyers for the government were present in the court. The barrister said he had just been informed that an application for the appointment of a special manager to carry out the administration had already been prepared in draft form. |
| The court is expected to grant a short adjournment to give the parties time to provide evidence to the court of what will happen in either case. | The court is expected to grant a short adjournment to give the parties time to provide evidence to the court of what will happen in either case. |
| Judge Barber said: “In the absence of some certainty there is too much at stake for the court to shoot blind. | Judge Barber said: “In the absence of some certainty there is too much at stake for the court to shoot blind. |
| “Any government decision would be subject to a formal ministerial decision, and no such decision has been made.” | “Any government decision would be subject to a formal ministerial decision, and no such decision has been made.” |
| Gupta has been scrambling to find new financing for his businesses since the collapse in 2021 of Greensill Capital, which had lent the Gupta Family Group (GFG) Alliance about $4.5bn (£3.3bn). Administrators for Greensill are trying to recover that money on behalf of creditors, including the investment bank Citibank. | Gupta has been scrambling to find new financing for his businesses since the collapse in 2021 of Greensill Capital, which had lent the Gupta Family Group (GFG) Alliance about $4.5bn (£3.3bn). Administrators for Greensill are trying to recover that money on behalf of creditors, including the investment bank Citibank. |
| The winding up petition was originally brought by an equipment supplier in October but SSUK had been granted several adjournments to give it more time to pursue negotiations for new investment, and then after it paid the debt to the lead claimant. The Greensill administrators stepped into the supplier’s place. | The winding up petition was originally brought by an equipment supplier in October but SSUK had been granted several adjournments to give it more time to pursue negotiations for new investment, and then after it paid the debt to the lead claimant. The Greensill administrators stepped into the supplier’s place. |
| Fundraising efforts have been complicated by an investigation into GFG Alliance by the UK’s Serious Fraud Office for suspected fraud, fraudulent trading and money laundering. | Fundraising efforts have been complicated by an investigation into GFG Alliance by the UK’s Serious Fraud Office for suspected fraud, fraudulent trading and money laundering. |
| At the same time, the steel industry has been hit by the turmoil caused by the coronavirus pandemic, followed by a glut of metal produced by Chinese companies. | At the same time, the steel industry has been hit by the turmoil caused by the coronavirus pandemic, followed by a glut of metal produced by Chinese companies. |
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| SSUK usually supplies aerospace and defence companies such as Rolls-Royce and Airbus. However, workers in South Yorkshire have dealt with years of uncertainty, as work at the plants has wound down. SSUK lost £340m in four years, according to figures revealed during the court process. | SSUK usually supplies aerospace and defence companies such as Rolls-Royce and Airbus. However, workers in South Yorkshire have dealt with years of uncertainty, as work at the plants has wound down. SSUK lost £340m in four years, according to figures revealed during the court process. |
| The Rotherham plant and a similar operation in Motherwell, Scotland, have not produced any steel for about a year because of a lack of working capital to buy materials. However, workers’ salaries have continued to be paid. | The Rotherham plant and a similar operation in Motherwell, Scotland, have not produced any steel for about a year because of a lack of working capital to buy materials. However, workers’ salaries have continued to be paid. |
| The Guardian last month revealed that the UK government was considering options to step in should SSUK fall into liquidation. It would be the second government intervention in the steel industry this year, after it took control of British Steel’s Scunthorpe plant, fearing that its Chinese owners would let the blast furnaces cool beyond repair. | The Guardian last month revealed that the UK government was considering options to step in should SSUK fall into liquidation. It would be the second government intervention in the steel industry this year, after it took control of British Steel’s Scunthorpe plant, fearing that its Chinese owners would let the blast furnaces cool beyond repair. |
| Gupta had hoped to prepare a plan to buy the company back out of insolvency, with the consultancy Begbies Traynor preparing a pre-pack administration that would allow the company to reduce its debts. The creditors opposed the plan, arguing they would prefer a sale via a government-controlled liquidation. | Gupta had hoped to prepare a plan to buy the company back out of insolvency, with the consultancy Begbies Traynor preparing a pre-pack administration that would allow the company to reduce its debts. The creditors opposed the plan, arguing they would prefer a sale via a government-controlled liquidation. |
| Court documents suggested that previous efforts in 2022 to sell part of the SSUK operations to an unnamed venture capital fund or a “Chinese conglomerate” came to nothing. | Court documents suggested that previous efforts in 2022 to sell part of the SSUK operations to an unnamed venture capital fund or a “Chinese conglomerate” came to nothing. |