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Liberty Steel misses accounts deadlines for major UK companies

The Guardian - Mon Apr 12 17:22

Liberty Steel has missed deadlines to file accounts for some of its biggest British businesses, in the latest sign of the struggles facing Sanjeev Gupta’s industrial empire.

Gupta is listed as director of 15 companies whose accounts are overdue at Companies House, including those that operate the Liberty Steel works in Rotherham and Stocksbridge in South Yorkshire.

Other facilities with overdue accounts include those in Newport and Tredegar in south Wales, Dalzell in Scotland and Coventry in the West Midlands, plus Gupta’s Scottish aluminium smelter.

Gupta is urgently seeking finance to shore up the loose collection of companies that are gathered together under the banner of GFG Alliance, including Liberty Steel, an aluminium company and an energy company. The alliance has about 35,000 employees worldwide, of whom 3,500 are in the UK.

Gupta funded takeovers of the various metals assets in the UK, Australia and elsewhere in part through loans advanced by Greensill Capital, a lender founded by the Australian banker Lex Greensill.

Greensill collapsed last month after having lent Gupta’s companies as much as $5bn (£3.6bn). The UK government ordered an independent inquiry on Monday into the former prime minister David Cameron’s role in lobbying for Greensill to access government-backed coronavirus loan schemes.

Credit Suisse, one of Greensill’s backers, is trying to recover money lent to Gupta’s companies via court action in the UK and Australia. Gupta, however, has insisted his companies do not yet owe the money while he seeks new lenders.

Liberty Steel operates via a labyrinthine web of companies, many of which are owned by a Singaporean parent company. Gupta alone is listed as a director of 79 UK firms.

Not filing an annual report is a criminal offence, although the maximum financial penalty for late filing is only £1,500 for a private company. It is generally seen as a red flag for other companies carrying out due diligence.

An insider said most of the companies had not filed audited accounts for the year ending on 31 March 2020 because they would no longer represent an up-to-date view of the businesses.

Since the end of the reporting period the coronavirus pandemic has caused a dramatic decline in demand from some of Liberty’s key clients, including those in the aerospace and automotive industries.

The opacity of Liberty Steel’s governance was a key reason behind the UK government’s refusal to provide an emergency loan of £170m. The government has instead worked on options to step in should the company fall into administration.

A spokesperson for GFG Alliance could not say when the accounts would be filed and declined to comment.