Whyalla steel mill owner Sanjeev Gupta said the collapse of major lender Greensill precipitated the “hardest month” of his life as the billionaire’s financial woes continued.
- Greensill collapse caused major uncertainty around GFG and Whyalla steel plant
- In an employee podcast, Mr. Gupta admitted that his business had been slow to diversify away from the lender
- However, he spoke about the prospects for the business, saying he intends to recover
Greensill Capital was one of the main lenders in Mr. Gupta’s GFG Alliance, but was placed in the hands of Grant Thornton Trustees after Global wealth manager Credit Suisse froze $ 10 billion in investment funds it relied on.
The chain of events left companies around the world in trouble, including GFG Alliance and its Whyalla steel mills, as well as the more than 1,200 workers at the plant.
In a more recent setback for the billionaire, the UK government reportedly rejected GFG’s request for a $ 307 million bailout for Liberty Steel UK, another branch of Mr Gupta’s empire.
Mr. Gupta has kept a low profile in recent months, doing few media interviews and remaining shy about his company’s fortunes.
In a podcast intended for his employees but made public by his company, Mr. Gupta insisted that there were no plans to sell parts of the “core” business.
But he admitted his steel operations were too dependent on Greensill for funding.
“This is part of the reason why we have consolidated the group, set up a board of directors, put in place non-executive directors, put in place all the governance and all the transparency and all the structure you have. need to access normal and traditional funding.
“It was in the process. Could we have done it earlier? Probably.
He said getting away from the crippled lender would be a “challenge”, but was confident he could meet it.
Greensill’s collapse coincided with other challenges for Mr Gupta, with the coronavirus taking a professional and personal toll.
As the pandemic has lowered demand for steel, Mr Gupta remains in Dubai after contracting COVID-19 during a Christmas trip with his family.
“I’m totally determined to… get out of it and out of it stronger.
“Most of the companies that are part of GFG have struggled before, and they did it with their own perseverance, their own courage and a willingness not to give up. “
Mr Gupta also responded to reports that Greensill and Liberty Steel had accessed around $ 720 million from the UK government’s large business interruption loan program against coronavirus – despite capping loans at around $ 90 million.
“As far as I know, Greensill took a lot of legal advice on the applicable rules… and they followed all the rules,” he said.
“What I can say for sure is that GFG hasn’t broken any rules.”
Mr. Gupta said there were “no plans to sell any of our core businesses,” and said GFG was now taking “strong and cautious steps” towards recovery.
“Which could include things like, you know, making some customers pay earlier,” he said.
“Environmentally our model is the right model, green steel is the way to go and everyone is accepting it now. “