Sanjeev Gupta’s GFG Alliance signs debt agreement with Credit Suisse

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Sanjeev Gupta of Liberty Steel smiles outside the company’s Liberty Steel processing plant in Dalzell, Scotland, UK April 8, 2016. REUTERS / Russell Cheyne

LONDON, Oct. 10 (Reuters) – The GFG Alliance on Sunday announced that it has entered into a debt restructuring agreement with Credit Suisse (CSGN.S) for its Australian steel and coal mining assets, and announced its intends to inject 50 million pounds (68 million dollars) into the restart of its Rotherham electric furnace in the United Kingdom.

GFG, owned by commodities tycoon Sanjeev Gupta, scrambled to refinance its network of cash-strapped businesses in steel, aluminum and energy after the chain finance company supply Greensill Capital filed for bankruptcy in March.

The debt restructuring of its Australian assets will allow GFG to make a “substantial upfront payment” to Greensill Bank and Credit Suisse, with the balance being paid in installments until the new June 2023 due date, according to a report. GFG press release.

Zurich-based Credit Suisse previously disclosed some $ 2.3 billion in loans exposed to financial uncertainties and litigation within supply chain finance funds linked to Greensill, with some $ 1.2 billion of its GFG-related assets.

Following the injection of cash into its UK steel business, Liberty Steel, production will begin in October with a production plan to reach 50,000 tonnes per month as soon as possible, the statement said.

Jeffrey S. Stein, director of restructuring, said in the statement that new lenders in Europe have expressed interest in refinancing GFG’s steel assets.

In Europe, GFG said it has launched legal action against private equity firm AIP, which said it had taken control of GFG’s smelter in Dunkirk, Europe’s largest primary aluminum producer. Read more

($ 1 = 0.7332 pounds)

Reporting by Zandi Shabalala; Editing by Jan Harvey

Our standards: Thomson Reuters Trust Principles.


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