Thousands of steel jobs could be at risk after the backer of the business behind Liberty Steel and other companies sought management.
Lender Greensill Capital has filed an administration application raising questions about the impact of around 5,000 workers on Sanjeev Gupta’s business empire, including Liberty Steel.
Greensill will appoint Grant Thornton to lead the administrative process after failing to repay a £ 101 million Credit Suisse loan.
The lender has a multi-billion pound exposure to the Sanjeev Gupta business empire.
Liberty owns 12 steel mills in the UK – including Rotherham, Stocksbridge, Newport and Hartlepool.
The community union is now seeking “representations on behalf of our members” the BBC reports.
A spokesman said: “We stand ready to work with everyone involved to protect jobs and gain confidence in the fact that this is an important strategic business with a world-class workforce that produces the best steels money can buy. “
A Grant Thornton spokesman said bankruptcy administrators Chris Laverty, Trevor O’Sullivan and Will Stagg have been appointed joint administrators of Greensill Capital and Greensill Capital Management Company.
The spokesman said, “The joint administrators are in constant discussion with an interested party regarding the purchase of certain Greensill Capital assets. As these discussions continue, it would be inappropriate to make any further comments at this point.”
Labor Shadow Secretary for Business and Consumers Lucy Powell said: “This is a deeply worrying situation and a very worrying time for Liberty Steel employees.
“It is important that the government act with the necessary urgency and not wash their hands off the situation.
“As we argued through the pandemic, the government should do more to support UK steel and the UK manufacturers who are its customers.
“Instead, they have been ignored, with no indication of the budget, which threatens jobs and weakens the foundations of our economy.”