Liberty Steel, the company led by British Indian businessman Sanjeev Gupta, on Monday announced "very constructive and productive meetings" as part of its ongoing restructuring plans, which will result in the sale of its Stocksbridge plant in south-east England to help pay back lender Credit Suisse.
Gupta, who heads the wider Gupta Family Group (GFG) Alliance, and his newly-formed Restructuring and Transformation Committee held advanced discussions with Credit Suisse Asset Management (CS) in Dubai over the weekend to reach a formal "standstill agreement" on its Liberty Primary Metals Australia business while refinancing is completed that will repay Credit Suisse out in full.
The investment bank has, meanwhile, agreed to pause court proceedings against Gupta's empire while the sale of Stocksbridge is conducted.
"Both parties also made significant progress in agreeing a framework to resolve GFG Alliance's remaining exposure with CS," Liberty Steel, the UK's third largest steel maker, said.
"This work includes identifying a positive solution which will allow Liberty to complete the restructuring and refinancing of its UK operations, protecting thousands of jobs and supporting the fulfilment of its vision to be a leader in the decarbonisation of the UK steel industry," it added.
A formal sale process for the aerospace and special alloys steel business at Stocksbridge and its downstream plants, the narrow strip mill at Brinsworth and Performance Steels at West Bromwich will be launched shortly, according to a statement by Liberty Steel.
The company has been working on a refinancing plan since its main lender Greensill Capital collapsed earlier this year.
"This sale will allow Liberty to focus on developing its Rotherham plant including its electric arc furnaces into a competitive 2 million tonnes recycled GreenSteel plant, one of the largest in Europe. The plant will make use of some of the millions of tons of steel scrap currently exported by the UK to make more of the quality steel needed in the UK, which is currently being imported," Liberty said.
The company said it has also already commenced the formal sale process of Liberty Aluminium Technologies and Liberty Pressing Solutions, working collaboratively with the main customers of these plants to find a "sustainable home for these quality businesses".
It comes as the UK's Serious Fraud Office (SFO) and the Financial Conduct Authority (FCA) launched investigations into the relationship between Liberty and its now-defunct controversial lender Greensill Capital. The company has said that it will cooperate with investigations as it continues its refinancing efforts.