Latest news with #GFGAlliance
ABC News
08-06-2025
- Business
- ABC News
GFG puts Whyalla port company into administration after government intervention
GFG Alliance has placed its subsidiary company which formerly operated the Whyalla port into administration, after the state government intervened in an ownership dispute over the facility. The company, Whyalla Ports Pty Ltd, was embroiled in a Federal Court case launched by Whyalla steelworks administrators KordaMentha, which wants control of the port so it can sell the steelworks as an integrated asset. The state government recently intervened by introducing law changes to "clarify" that the port is owned by OneSteel Manufacturing — the GFG subsidiary that operated the steelworks before being tipped into administration — rather than Whyalla Ports Pty Ltd. In a statement released on Saturday, a GFG Alliance spokesperson said the law change left it with "no option but to place Whyalla Ports Pty Ltd into voluntary administration". The spokesperson added that the company was "confident" the Federal Court case would have been decided in its favour "had the Australian legal system been allowed to determine the matter in the usual way". "Whyalla Ports revenue has been severely impacted by the actions of the South Australian Government," the spokesperson said. "Whyalla Ports Pty Ltd is unable to engage in any commercial activity after the termination of its lease and the seizure of assets by the South Australian Government at the request of the Administrators. "These actions have resulted in a complete stop in all revenue streams and therefore no ability to pay creditors." KordaMentha has continued to operate the port throughout the ownership dispute, while the state government said GFG's decision has no impact on the facility's operation. "The port continues to operate as usual," a state government spokesperson said. "The voluntary administration of any GFG operation is a matter for GFG." GFG claims that the administrators of the steelworks have "continued to use Whyalla Ports Pty infrastructure on land leased by Whyalla Ports without effecting payment for use of the land or infrastructure worth millions of dollars". But the state government claims that ministerial consent was required to lease the port and "this consent was neither sought nor granted". "The Government had complete confidence in the legal action undertaken by KordaMentha, however the legislative changes clarify the consequence of failure to gain consent and will ensure similar action will not be necessary in future," the government spokesperson said. KordaMentha sought to withdraw its legal claim against Whyalla Ports at a Federal Court hearing on Tuesday, saying the government's law changes had achieved what they were seeking. But the court also heard a cross-claim by the defendant, Whyalla Ports, would continue, with their lawyers telling the court there is still a dispute over the ownership of some assets. The matter is expected to go to trial in August. GFG said on Saturday that its decision to appoint administrators for Whyalla Ports will have "no operational impact on the rest of GFG Alliance".
West Australian
05-06-2025
- Business
- West Australian
Treasurer Stephen Mullighan spends big on Whyalla steel in 2025-26 South Australian budget
The troubled Whyalla steelworks, law and order and a bold bid to bring the mammoth COP31 climate conference to Adelaide are the big winners from South Australia's pre-election budget. Treasurer Stephen Mullighan has promised $650m over six years for the steel plant as part of a $2.4bn 'sovereign steel package' backed by the federal government. In his speech to the state parliament on Thursday afternoon, Mr Mullighan outlined where the money would go and said the allocation would preserve the state's industrial capacity. 'Our unprecedented intervention to place the Whyalla steelworks into administration has protected thousands of jobs, hundreds of businesses and ensured Australia remains a country that manufactures critical steel products,' he said. 'Under this government, South Australians will not be taken for fools by fast-talking businessmen that continually break their promises to our state … the ($650m) funding is for administration costs, investment in the plant to support the sale and for a comprehensive rescue package that safeguards the Whyalla community.' The state government took control of Whyalla from British steel magnate Sanjeev Gupta in February and administrators KordaMentha are working to secure a buyer for the integrated plant. Before the shock takeover, the steelworks suffered losses for months and the government grew increasingly sceptical Mr Gupta's GFG Alliance would meet its debt obligations. The steelworks is a core economic engine for Whyalla, a town of 22,000 people, and the state more broadly. It is Australia's only fully integrated steelmaking enterprise, producing slabs, billets, hot rolled structural steel and rail products. Thursday's budget comes about nine months before the Labor government, led by Premier Peter Malinauskas, will return to the polls in March next year. In a pre-election pitch, Mr Mullighan said the budget preserved the state's industrial capacity, supported farmers battling through punishing drought conditions and demonstrated the government's 'sound financial management'. 'We are the lowest taxing state on the mainland,' Mr Mullighan said. 'And we have kept our promise not to introduce new taxes or increase existing ones. 'We've done all this while returning the budget to surplus and improving the state's credit rating outlook.' The budget delivers a surplus of $179m for 2025-26 and forecasts a $369m surplus for 2026-27 and $458m for 2027-28. Those figures are predicated on gross state product growth rates of 1.75 per cent for 2025-26, and then 2 per cent for both 2026-7 and 2027-28. Net debt is expected to expand from $35.5bn in 2025-26 to $48.5bn in 2028-29. Law and order is also a big winner, with the budget delivering $172m over six years to accommodate additional sworn officers. The state aspires to have a total sworn force of 5000 officers by 2030-31. 'While crime rates have fallen over the course of this government, we continue to toughen laws, expand our prisons and equip our police and criminal justice system with the resources needed to combat crime,' he said. 'This budget provides the largest boost to police funding in the state's history.' A bid to lure the COP31 climate conference to Adelaide is also a standout allocation, receiving $8.3m. A $118m cost-of-living package includes a stark boost for students. The price of student metro card 28-day passes, which are used across Adelaide's bus, rail and tram network, will tumble from $28.60 to just $10. The change means a student catching public transportation will pay the equivalent of 25 cents a trip. The Liberal Party, led by Opposition Leader Vincent Tarzia, said the budget demonstrated Labor was 'out of money and out of ideas'. Mr Tarzia said the state was now confronting a 'debt iceberg', citing the $48.5bn figure as the largest in the state's history. 'The debt iceberg will sink the dreams of future South Australians' he said. 'What's abundantly clear is that Labor is completely out of touch with the needs of South Australians and instead, is frivolously whittling away taxpayer dollars on vanity projects that don't deliver any relief from sky-high energy prices, water bills and the housing crisis. 'A budget like this leaves South Australia vulnerable to economic shocks, which could come from any direction in the current economic climate. '
News.com.au
05-06-2025
- Business
- News.com.au
Treasurer Stephen Mullighan spends big on Whyalla steel in 2025-26 South Australian budget
The troubled Whyalla steelworks, law and order and a bold bid to bring the mammoth COP31 climate conference to Adelaide are the big winners from South Australia's pre-election budget. Treasurer Stephen Mullighan has promised $650m over six years for the steel plant as part of a $2.4bn 'sovereign steel package' backed by the federal government. In his speech to the state parliament on Thursday afternoon, Mr Mullighan outlined where the money would go and said the allocation would preserve the state's industrial capacity. 'Our unprecedented intervention to place the Whyalla steelworks into administration has protected thousands of jobs, hundreds of businesses and ensured Australia remains a country that manufactures critical steel products,' he said. 'Under this government, South Australians will not be taken for fools by fast-talking businessmen that continually break their promises to our state … the ($650m) funding is for administration costs, investment in the plant to support the sale and for a comprehensive rescue package that safeguards the Whyalla community.' The state government took control of Whyalla from British steel magnate Sanjeev Gupta in February and administrators KordaMentha are working to secure a buyer for the integrated plant. Before the shock takeover, the steelworks suffered losses for months and the government grew increasingly sceptical Mr Gupta's GFG Alliance would meet its debt obligations. The steelworks is a core economic engine for Whyalla, a town of 22,000 people, and the state more broadly. It is Australia's only fully integrated steelmaking enterprise, producing slabs, billets, hot rolled structural steel and rail products. Thursday's budget comes about nine months before the Labor government, led by Premier Peter Malinauskas, will return to the polls in March next year. In a pre-election pitch, Mr Mullighan said the budget preserved the state's industrial capacity, supported farmers battling through punishing drought conditions and demonstrated the government's 'sound financial management'. 'We are the lowest taxing state on the mainland,' Mr Mullighan said. 'And we have kept our promise not to introduce new taxes or increase existing ones. 'We've done all this while returning the budget to surplus and improving the state's credit rating outlook.' The budget delivers a surplus of $179m for 2025-26 and forecasts a $369m surplus for 2026-27 and $458m for 2027-28. Those figures are predicated on gross state product growth rates of 1.75 per cent for 2025-26, and then 2 per cent for both 2026-7 and 2027-28. Net debt is expected to expand from $35.5bn in 2025-26 to $48.5bn in 2028-29. Law and order is also a big winner, with the budget delivering $172m over six years to accommodate additional sworn officers. The state aspires to have a total sworn force of 5000 officers by 2030-31. 'While crime rates have fallen over the course of this government, we continue to toughen laws, expand our prisons and equip our police and criminal justice system with the resources needed to combat crime,' he said. 'This budget provides the largest boost to police funding in the state's history.' A bid to lure the COP31 climate conference to Adelaide is also a standout allocation, receiving $8.3m. A $118m cost-of-living package includes a stark boost for students. The price of student metro card 28-day passes, which are used across Adelaide's bus, rail and tram network, will tumble from $28.60 to just $10. The change means a student catching public transportation will pay the equivalent of 25 cents a trip. The Liberal Party, led by Opposition Leader Vincent Tarzia, said the budget demonstrated Labor was 'out of money and out of ideas'. Mr Tarzia said the state was now confronting a 'debt iceberg', citing the $48.5bn figure as the largest in the state's history. 'The debt iceberg will sink the dreams of future South Australians' he said. 'What's abundantly clear is that Labor is completely out of touch with the needs of South Australians and instead, is frivolously whittling away taxpayer dollars on vanity projects that don't deliver any relief from sky-high energy prices, water bills and the housing crisis.
ABC News
04-06-2025
- Business
- ABC News
More job losses flow from Whyalla steelworks administration
After 19 years in a job that had been his pride and joy, Dylan Leebody is being forced to hang up his boots as another company in the troubled South Australian city of Whyalla enters administration. "It was a bit shocking at first to realise they're saying the days are numbered for this workshop … it was a bit disheartening," he said. "A lot of people are stressed out obviously about finding work." The workshop leading hand is one of 47 workers staying on at steel fabrication company Ferretti International, owned by GFG Alliance, until its final projects are finished. More than 100 jobs have already been lost, with 34 active staff terminated and the cessation of employment formalised for another 65. Mr Leebody said many employees were likely to find new roles but some could have to look beyond Whyalla. But for workers like himself with two young boys, relocation or FIFO work was not an option. Australian Manufacturing Workers' Union SA secretary Stuart Gordon said entitlements were also a major concern. "There's around $2.1 million owed in entitlements currently, we hope they can find the money and that's paid out," he said. He said there was still hope among workers OneSteel would buy the plant. Speaking after the first creditors meeting for Ferretti on Monday, administrator Michael Brereton from William Buck said the business was reliant on OneSteel as "its major customer". That was confirmed in a statement provided to the ABC by a GFG spokesperson, which noted that placing OneSteel into administration had resulted in "a significant downturn of Ferretti's revenue and operations". "[Ferretti's] employees have valuable skills and while the continued employment of the Ferretti workforce is a matter for the administrators, it is hoped that some employees will transfer to OneSteel," the spokesperson said. Ferretti was not the only business experiencing job losses that have been blamed on the town's struggling steelworks. Rail haulage group Aurizon has also explored the reduction of its workforce. According to a statement provided to the ABC by Aurizon, OneSteel had advised of an intention to "ramp down mining operations in FY2026", which would result in a reduction in train services from July 2025. "Aurizon is consulting with our workforce on the impact of this decision on our Whyalla-based workforce, which is expected to see a potential reduction of up to 24 positions," it said. Rail, Tram, and Bus Union (RTBU) SA secretary Darren Phillips said the organisation was planning to "explore options with Aurizon moving forward". Whyalla City Council mayor Phill Stone said the community remained resilient in the face of more job losses and many hoped the eventual sale of the steelworks could turn things around.
The Guardian
21-05-2025
- Business
- The Guardian
Liberty Steel has not produced anything at two key plants since July 2024
Liberty Steel has produced nothing at two of its key UK plants since July, in a sign of the deep financial difficulties for Britain's third-biggest steelmaker as it looks for rescue funding. The plants at Rotherham in South Yorkshire and Motherwell in Scotland have not produced any steel for about nine months because of lack of funds to buy vital materials, with workers on furlough on 85% of their salaries for the duration, according to workers who spoke to the Guardian. Steel companies have been struggling for several years. UK steel production fell in 2024 to its lowest since the 1930s, and the last month the government effectively took over the British Steel blast furnaces at Scunthorpe, amid fears over 2,700 job losses and the end of primary steel making in the UK. Liberty Steel is ultimately owned by Sanjeev Gupta, whose GFG Alliance metals empire is under severe financial pressure across the world after a debt-fuelled expansion spree. Gupta has been battling for control of metals companies in the UK and Australia against creditors led by the administrators for Greensill Capital, a lender that collapsed in 2021. Greensill had lent Gupta's companies about $5bn (£3.7bn). The financial turmoil has left Liberty Steel's UK plants unable to access cash needed to run their operations, with one creditor seeking to recover money via a winding up petition at London's high court on Wednesday. The Liberty subsidiary that runs the site at Rotherham, called Speciality Steel UK (SSUK), was granted until 16 July to hold talks with unnamed potential investors, in a desperate effort to avoid a liquidation that would put 1,450 jobs at risk. The Labour government would face pressure to step in if the Rotherham plant, seen as an important part of British steel-making capabilities, faced bankruptcy. SSUK supplies aerospace and defence companies including Rolls-Royce and Airbus, and operates an electric arc furnace at Rotherham, a related works nearby at Stocksbridge, and two other sites. That business owes creditors £619m, including £289m to related GFG companies and £289m to Greensill's administrators. Greensill's administrators, Grant Thornton, earlier this month opposed a restructuring plan that would have cut the amount owed to it significantly, leaving Liberty scrambling to find other emergency funding. Daniel Judd, a barrister representing the company, told the court that SSUK was 'urgently considering its options' after the failure of the restructuring plan, including talks to try to secure an unnamed 'third-party investor'. 'Urgent meetings have been taking place to advance this,' he told the court. The group confirmed it is considering a sale of its SSUKbusiness in South Yorkshire, saying that 'change is essential'. Jeffrey Kabel, Liberty's chief transformation officer, said: 'Today's adjournment is a positive development, allowing us the necessary time to finalise options including a sale of the business while we continue to pursue our debt restructuring efforts. 'We remain committed to finding the right solution that preserves electric arc furnace steel making in the UK, a vital national asset serving strategic supply chains.' Kabel said Greensill's collapse was 'restricting its access to capital', alongside 'longstanding competitiveness challenges dating back decades' for British steelmakers. Alun Davies, national secretary for steel at Community, a union representing workers, said the extra time 'essentially amounts to the company kicking the can down the road' and 'will achieve very little' other than uncertainty and distress for the workforce. 'Things cannot go on as they are,' he said. 'Sanjeev Gupta must demonstrate now that he is willing to invest in the business in a meaningful way, or he should step aside and make way for a new, responsible owner.' The UK's Serious Fraud Office has been investigating GFG Alliance and Greensill over 'suspected fraud, fraudulent trading and money laundering' since 2021. Government figures have long been wary of offering financial support to Gupta's companies in light of the investigation and concerns over whether money would be used to prop up businesses in other countries. Before July, Rotherham was running month-on, month-off for as long as five years, relying mainly on customers who could make pre-payments to buy materials needed. Rotherham runs the UK's largest electric arc furnace, melting scrap steel to make specialised automotive and aerospace parts. The Scottish site is run by another subsidiary, Liberty Steel Dalzell. Workers at the plant are concerned that the failure to restart production could result in the Royal Navy considering other options for steel for new warships. The fleet solid support ships are due to be made with steel from British Steel in Scunthorpe, which would be rolled into plate at Dalzell, and then fabricated at Harland & Wolff in Belfast. It is understood that the company is confident the Dalzell plant will be able to restart work soon.
