Sanjeev Gupta, chief of Liberty House, is being dubbed UK's new 'man of steel' after he emerged as a potential saviour of 4,000 jobs
UK-based steel tycoon Sanjeev Gupta says he is committed to saving the 4,000-odd jobs at the troubled Tata Steel’s Port Talbot plants, which are Britain’s largest, but has warned the country’s steel crisis will not abate any time soon.
The 44-year-old founder and chief of Liberty House Group, who evinced interest in acquiring the steelworks in Wales, has since held a series of discussions, including with UK business secretary Sajid Javid.
In an interview with PTI, he said saving nearly 4,000 jobs on the line were on his mind.
He said: “There has been a lot of pressure and my number of sleeping hours has definitely gone down. It’s a difficult moment and whether we go ahead or not, that crunch time will come in the next few weeks. If heavy job losses comes out to be the price to pay, we would not be the ones undertaking that exercise. We will undertake this exercise if we can sustain jobs, which we feel is possible at this stage.”
His comments come ahead of the formal process for the sale of Tata Steel’s UK units, set to kick off on Monday, when the Indian steel giant is expected to invite interested buyers. Bilateral negotiations are set to begin only after a formal short-listing process.
Gupta admits the crisis in the industry is set to get worse before it gets better due to excess steel capacity around the world but remains optimistic of its turnaround.
“I don’t think the crisis will abate any time soon as the main issue is excess capacity, which will continue in the world for some time. But based on domestic demand, each country can make an efficient industry out of it (steel),” he said.
And, he feels he has worked out the right formula if he were to acquire the Port Talbot works, with plans to switch from the giant blast furnace to electric arc furnaces to recycle scrap steel instead of importing raw materials, and then exporting scrap.
Asked if the government can do more to help, he said: “Even if more was or is done, the model itself is to be questioned. The model based on countries (China) where there is no raw material and they are holding everything is the problem.”
The Punjab-born graduate from Cambridge University is being dubbed the UK’s new ‘Man of Steel’, after he emerged as a potential saviour of jobs if he were to acquire Tata Steel’s Welsh units, which went up for sale last month.
“Both the governments (British and Welsh) are very helpful and cooperative. Then, it is a question of analysis, which we will have to undertake in-depth once we engage with Tata. That is when the model and concept we have clearly outlined and plan to pursue will be tested with real numbers,” he said.
Against the backdrop of the current negotiations, last week also marked the official handover of keys by Tata Steel to Liberty House for the Indian giant's Scottish units at Dalzell and Clydebridge in Lanarkshire. The deal to acquire the two Tata plants has been in the works since late last year and was finally clinched last month.
"This particular deal was being negotiated since November last year. Now that we finally have the control and the possibility to get going, it's exciting," he said.
But asked if Tata's decision to exit the UK may impact future Indian investments, Gupta was categorical: "The point is the industry needs investments and India has a natural affinity with the UK, which is why to begin with all these investments were done by Tata, and that will continue."
Gupta, who struck upon the idea to set up a metals trading company from his student flat at Trinity College back in 1992, has the offices of Liberty House across London, Dubai, Hong Kong and Singapore and a turnover of over 2 billion pounds.
He hit the headlines in the UK in October last year when he restarted hot-rolled coil production at a rolling mill in Newport, South Wales, after a 40-year hiatus.
Job security was again a primary concern when the firm had acquired the facility in 2013 during tough times, retaining the 150 staff over the intervening period in order to be ready to restart when market conditions allowed.
Liberty House also went on to make a series of acquisitions in the UK steel industry in 2015, including some of NRI industrialist Lord Swraj Paul's Caparo Industries units.
The hunger to strike tough deals seems to run in the family, with his father P K Gupta starting out in bicycle manufacturing before expanding into international commodities trading. Today the family owned group, SIMEC, has interests across metals and renewable energy with Liberty as a sister firm. SIMECrecently acquired asubstantial stake in the UK's Tidal Lagoon Plc to finance the development of full-scale tidal lagoons in the UK and India.
Gupta has a vision for "Green Steel", using renewable energy to melt the readily available supply of scrap in Britain, instead of relying on the import of iron ore and coal from far flung corners of the globe.
"Energy has always been central to our concerns," Gupta said.