British Liberty Steel Group, a member of GFG Alliance company of Sanjeev Gupta (Sanjeev Gupta), today announced that it was named preferred buyer for the bankrupt American firm Bayou Steel Group, which is under external control from late September. The cost of the acquisition of a steel plant in Louisiana is estimated at $ 28 million.
In September 2019 Bayou Steel sent a letter to the parish of St. John the Baptist and the Commission on the employment of Louisiana, which stated that "unforeseen circumstances and the failure to provide the necessary capital," demanded the immediate closure of production.
October 1, Bayou Steel Group filed a suit about protection from bankruptcy under Chapter 11 of the bankruptcy Code of the United States. According to a statement released by the company, "this unfavorable situation was caused by a severe lack of liquidity, which led to a default with the senior secured creditor and has created a situation when the company could no longer buy raw materials".
Liberty Steel plans to resume production of steel and rolling production in the second half of 2020.
Bayou will expand the scale of the us steel business Liberty, which includes existing operations in Illinois, Ohio, new Mexico and South Carolina.
the Group follows a strategy of "Greensteel", aimed at renewable energy sources and recycled materials, aiming to the production of steel carbon neutral by 2030.
Commenting on the acquisition, Sanjiv Gupta, Executive Chairman, GFG Alliance, said he sees great potential in the enterprise.
"Bayou benefits from reliable access to supplies of raw materials, competitive prices for electricity and its own deep-water port," - said Gupta.
After a complete modernization of the plant will increase total production capacity Liberty in the U.S. to 3 million tons per year, bringing the British company towards its goal of 5 million tons of steel per year.
