has reached an out-of-court settlement with Liberty Steel to resolve its €7 million claims of unpaid debts related to the Sanjeev Gupta-led firm’s €100-million takeover of Tatas’ speciality steels business in the UK in 2017.
“We can confirm an agreement has been reached to stay court proceedings, but the terms of this are confidential,” a Tata Steel spokesperson told ET on Thursday.
Tata Steel had in April launched proceedings against Liberty Speciality Steels, Liberty House Group PTE and Speciality Steel UK, all part of GFG Alliance, over the alleged missed payments from the 2017 acquisition.
The settlement comes at a time when British Indian entrepreneur Sanjeev Gupta, founder chairman of the $20-billion revenue GFG Alliance, is fighting his biggest battle to save his metals-to-energy conglomerate.
Liberty Steel has declined to comment on the matter.
The company is actively looking for short-term financiers after its biggest lender Greensill Capital collapsed and filed for insolvency earlier this year, Gupta told ET in an interaction.
A request by GFG to the UK government for €170 million to support the UK operation has been rejected by the government. Britain’s business minister Kwasi Kwarteng called the structure of Liberty ‘opaque’.
Gupta said his family business for “three generations” decided to become “more of a corporate” last year. “We merged the group into one single global corporate and appointed a global auditor (and) we started putting independent board members.”
Gupta said he has a plan to manoeuvre his businesses out of trouble. “Of course, it (collapse of its main backer) has put a strain, but in terms of refinancing Greensill, there is a lot of interest,” he told ET.