AGSI in takeover bid for Gupta’s collapsed UK steel firm

• Abu Dhabi company in for SSUK
• SSUK in hands of UK government
• UK steelmaking industry hit by tariffs

Arabian Gulf Steel Industries has reportedly submitted a bid to acquire the UK’s third-largest steel producer Speciality Steels UK, a collapsed division of Sanjeev Gupta’s Liberty Steel Group empire. 

Abu Dhabi’s privately owned AGSI is among a “small number of companies” that have expressed interest in taking over SSUK, according to Sky News.  

AGSI operates a scrap-based production model, using 100 percent locally sourced recycled steel to avoid the emissions associated with blast furnaces in traditional steelmaking, it says.

It aims to produce 5 million tons of steel by 2030 and reduce carbon dioxide emissions by more than 95 percent when compared to traditional steelmaking processes.  

UAE companies, including Abu Dhabi’s Masdar, have also invested heavily in UK clean energy production, for example large-scale wind and solar farms. 

SSUK operates sites at Rotherham and Stocksbridge in South Yorkshire and Wednesbury in the West Midlands and employed close to 1,500 people across its operations when it collapsed last August. 

The UK’s insolvency court granted a compulsory winding up order sought by SSUK creditors allegedly owed hundreds of millions of pounds. 

The company is now in the hands of the UK government, which is seeking to find a buyer for it to safeguard Britain’s historic steelmaking capabilities. The government agreed last year to cover the ongoing wages and costs of the plants while a buyer is sought.

Sky News cited a source as saying AGSI might be interested in financial backing from the UK’s National Wealth Fund, formerly known as the UK Infrastructure Bank under the previous Conservative administration. 

The UK’s steelmaking industry is facing an uncertain future defined by high energy costs and the threat of US-imposed tariffs. The sector faces a 25 percent tax on exports to the US from this March, having been temporarily spared from President Trump’s order last year that would have doubled steel and aluminium tariffs to 50 percent.  

Further reading:

• Abu Dhabi Ports in green steel deal with UK producer
• Gulf steel has a keen edge on Chinese and Indian rivals
• UAE green steel project brushes off hydrogen concerns

SSUK was among the companies owned by Liberty Steel Group’s parent company GFG Alliance, led by Indian-born British businessman Gupta. 

The group fell into financial turmoil when its main lender, Greensill Capital, collapsed in 2021, owing billions of pounds to investors including Swiss bank UBS.

AGBI has contacted AGSI, Liberty Steel, the UK’s Insolvency Service and the National Wealth Fund for comment.