Sanjeev Gupta fights lender’s efforts to seize control of aluminium mill

Sanjeev Gupta is fighting to maintain a Belgian aluminum plant after a US private equity firm has taken legal action to take control in the UK.

Gupta’s metal group GFG Alliance, which is being investigated by the Serious Fraud Office in the United Kingdom, Refinancing Over $ 5 billion in debt was incurred after the collapse of its main lender, Greensill Capital.

However, a lender to GFG’s rolling mill in Duffel, a suburb of Antwerp, said last week that people familiar with the matter were private equity firm American Industrial Partners, but began legal proceedings last week.

AIP has succeeded in persuading the court to appoint an administrator for the UK holding company that owns the property. This process could transfer ownership of the duffle factory to AIP, the holder of the $ 59 million debt.

GFG and AIP did not immediately respond to the request for comment.

Minutes are up to date Soaring legal issues Gupta is facing from a creditor this year.Recently born indian businessman Won the amnesty After trying to close some of his companies with unpaid debt from Credit Suisse, a major investor in Greensill Capital’s debt. Meanwhile, GFG says it will “fully cooperate” with the SFO probe announced in May.

AIP’s challenge is Rescue loan recently negotiated by Gupta Commodity trader Glencore and the entire European aluminum business are offering to refinance their debt. London-listed miners and trading companies have offered to refinance more than $ 500 million in debt with a new six-year loan at both Dufflesite and its French sister plant in Dunkirk.

Earlier this year, AIP bought all of the debt at the Duffel plant and part of the debt at the Dunkirk Aluminum Smelter and offered Gupta to buy two assets.

In a memo to senior management last week, Gupta confirmed that the group refused to bid on AIP for two assets, and GFG “used a friendly settlement of their debt using facilities agreed with Glencore. We are aiming for it. ”

However, people familiar with the situation say that while Gupta could result in maintaining control of the French smelter, it could cause a private equity firm in the United States to lose control of the Belgian smelter. It was.

Glencore is primarily interested in the Dunkirk Aluminum Smelter, Europe’s largest producer of 280,000 tonnes of lightweight metal annually. This transaction will give Glencore access to metals that can be sold through its vast trading division.

Gupta wrote in a memo to staff that GFG signed a contract with London-listed group and rival trading company Trafigura to supply raw materials to Dunkirk and Duffel, and Glencore “supported product marketing. We will provide a hedging facility. “

“These agreements help secure the working capital needs of the enterprise and can mitigate the risk of the enterprise by capturing current highs,” said Gupta.