The GFG Alliance of Sanjeev Gupta bought the indirect shareholder of two steel firms that called in administrators this month.
After attempting to seize control of one of his largest British clients, the steel magnate Sanjeev Gupta has caused a dispute.
Mr. Gupta’s GFG Alliance has acquired control of a Singapore-based business known as Aartee Group Pte Limited. Which is an indirect shareholder in two UK steel companies that went bankrupt last week.
According to sources, GFG was expected to release a statement on Friday evening confirming the acquisition and announcing that it has launched a legal challenge to overturn the administration of Aartee Bright Bar Ltd and Aartee Bright Bar Property Ltd.
FGI Worldwide, Aartee’s biggest creditor, filed for insolvency, and Alvarez & Marsal was appointed administrator.
About 250 individuals in the West Midlands, Rugby, Bolton, Southampton, and Newport are employed by Aartee. Which purchases steel bars used in industries such as construction.
A&M is allegedly in talks with many parties to buy the two companies and their assets.
GFG, the owner of Mr. Gupta’s Liberty Steel empire, is expected to announce that it has given funding to cover Aartee Bright Bar’s wages for four weeks during the administration process to avoid job losses.
It was unclear on Friday, however, whether A&M would take this funding or whether layoffs were imminently being considered.
Mr. Gupta is said to have close connections to Aartee’s founder, Ravi Trehan, and Greensill Capital. A controversial supply chain finance firm that collapsed in 2021, is said to have financed several trades between the two.
Michael Magnay, the joint administrator at A&M, said in a statement released at the time of its appointment, Like many companies in its industry, Aartree Bright Bar has been facing significant headwinds due to the challenging economic climate and fluctuating steel prices.
In light of this, administrators have been appointed, and we are evaluating our choices for preserving value.
Aartee Bright Bar’s insolvency coincides with discussions between the government and Liberty Steel’s two bigger rivals, Tata Steel and British Steel, regarding £600 million in public funding to facilitate their transition to more environmentally friendly electric arc furnaces.
British Steel’s Chinese owner’s proposal to cut 800 jobs, mostly at its Scunthorpe factory, threatens its financing.
Mr. Gupta has also revealed plans to eliminate hundreds of positions throughout his UK operations.
Both GFG and A&M have been reached for feedback.
