News: Speciality Steel in administration, "government committed to not letting it fail"
The latest from the High Court indicates that Liberty Steel's owners are losing its battle to keep hold of its Speciality Steel business.
Earlier this week a judge adjourned a case regarding a winding-up order regarding Speciality Steel UK Ltd (SSUK), which has operations in Rotherham and Stocksbridge.
The judge in the case asked for more information on what would happen under two scenarios - if SSUK was wound up, and if a pre-pack administration was to take place. The second scenario is likely to be opposed by creditors.
But now a different judge has approved an application from creditors to place the steel business into compulsory liquidation.
A winding up petition is issued to the courts by those seeking to recover money that they are owed. The judge agreed with the creditors and a winding-up order was made on August 21.
The court heard that the Department for Business and Trade has been preparing in the event of an Official Receiver being appointed, and was prepared to take control of SSUK’s affairs.
The Guardian reported the judge's decision, quoting Mr Justice Mellor as stating that: “It is quite clear that there are special managers lined up who have the support of the government. I consider by far the preferable approach is to make a winding-up order.”
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Official Receiver, Gareth Jonathan Allen, has been appointed as liquidator. Teneo Financial Advisory Limited has been appointed as Special Managers of the company to assist the Official Receiver with the liquidation.
The Official Receiver will wind-up the company in accordance with his statutory duties. He also has a duty to inquire into the cause of the company’s failure and conduct of current and former directors.
Creditors and subcontractors are being urged to get in touch.
The UK company was hit by the collapse of Greensill, a specialist in invoice financing that operated with less regulation than the traditional banks.
Court documents from February regarding Greensill creditors and SSUK show that the Liberty company has a debt with them of approximately £289m. The debts owed to Greensill creditors in respect of the activities of the GFG Group amount, in broad terms, to some US$4 billion.
Sarah Champion, MP for Rotherham, said: "All I can say is; I’ve been in conversation with the Government for months about the future of this strategic and profitable business, and they are committed to not letting it fail. You have my word that I will do all in my power to make sure that is the case."
Charlotte Brumpton-Childs, GMB National Officer, said: “This is another tragedy for UK steel - and the people of South Yorkshire - this time brought on by years of chronic mismanagement by the owners.
“But this represents an opportunity for the Government to take decisive action, as it did with British steel, to protect this vital UK industry.”
Cllr. Chris Read, leader of Rotherham Council, said on Threads: "The end of a long rollercoaster period of Liberty ownership brings uncertainty but also the opportunity of fresh beginnings with more solid plans. Glad the government has heeded our urging and taken over operational costs while those plans take shape."
Liberty Steel website
Images: Google Maps
Earlier this week a judge adjourned a case regarding a winding-up order regarding Speciality Steel UK Ltd (SSUK), which has operations in Rotherham and Stocksbridge.
The judge in the case asked for more information on what would happen under two scenarios - if SSUK was wound up, and if a pre-pack administration was to take place. The second scenario is likely to be opposed by creditors.
But now a different judge has approved an application from creditors to place the steel business into compulsory liquidation.
A winding up petition is issued to the courts by those seeking to recover money that they are owed. The judge agreed with the creditors and a winding-up order was made on August 21.
The court heard that the Department for Business and Trade has been preparing in the event of an Official Receiver being appointed, and was prepared to take control of SSUK’s affairs.
The Guardian reported the judge's decision, quoting Mr Justice Mellor as stating that: “It is quite clear that there are special managers lined up who have the support of the government. I consider by far the preferable approach is to make a winding-up order.”
Advertisement
Official Receiver, Gareth Jonathan Allen, has been appointed as liquidator. Teneo Financial Advisory Limited has been appointed as Special Managers of the company to assist the Official Receiver with the liquidation.
The Official Receiver will wind-up the company in accordance with his statutory duties. He also has a duty to inquire into the cause of the company’s failure and conduct of current and former directors.
Creditors and subcontractors are being urged to get in touch.
The UK company was hit by the collapse of Greensill, a specialist in invoice financing that operated with less regulation than the traditional banks.
Court documents from February regarding Greensill creditors and SSUK show that the Liberty company has a debt with them of approximately £289m. The debts owed to Greensill creditors in respect of the activities of the GFG Group amount, in broad terms, to some US$4 billion.
Sarah Champion, MP for Rotherham, said: "All I can say is; I’ve been in conversation with the Government for months about the future of this strategic and profitable business, and they are committed to not letting it fail. You have my word that I will do all in my power to make sure that is the case."
Charlotte Brumpton-Childs, GMB National Officer, said: “This is another tragedy for UK steel - and the people of South Yorkshire - this time brought on by years of chronic mismanagement by the owners.
“But this represents an opportunity for the Government to take decisive action, as it did with British steel, to protect this vital UK industry.”
Cllr. Chris Read, leader of Rotherham Council, said on Threads: "The end of a long rollercoaster period of Liberty ownership brings uncertainty but also the opportunity of fresh beginnings with more solid plans. Glad the government has heeded our urging and taken over operational costs while those plans take shape."
Liberty Steel website
Images: Google Maps
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