Steel tycoon Sanjeev Gupta failing to pay bills, say suppliers

Wednesday 28th November 2018 01:22 EST

Suppliers to Sanjeev Gupta's expanding Liberty House have shed some light on their struggle to get credit insurance, warning that they are owed substantial sums. Five companies that supply goods and services to parts of the Gupta Family Group (GFG) Alliance's British operations, said they were struggling to secure payment from the steel, commodities and energy conglomerate. Credit insurer Euler Hermes is understood to have withdrawn cover entirely from suppliers to Liberty House, a collection of businesses under the GFG umbrella.

Several suppliers said they could not avail credit insurance for Liberty House. While two of the biggest providers, Euler Hermes and Atradius declined to comment, another big supplier said it was refusing to supply Gupta's speciality steel business until its outstanding debt was paid. A third supplier said it was pursuing a county court judgment against GFG because a debt worth tens of thousands of pounds was threatening its viability. “There could be multiple reasons for an overdue payment, very often related to problems with supplier's paperwork. This is not unusual in the steel industry. Some of our units are still in turnaround mode following administration or re-starting from scratch following closure and this can sometimes pose challenges with payments and rebuilding supplier relationships.”

It added, “On the whole, we are confident these issues have been largely resolved and it is company policy to pay within agreed periods wherever possible.” GFG also said the “overwhelming majority of credit insurance underwriters are supportive of the business. They have significantly increased the cover written on the group today than 18 months ago and as we grow further we expect that to continue.”

GFG's operations have more than 14,000 staff and £11.7 bn of turnover. The business is set to expand further with the impending purchase of steelworks across Europe from ArcelorMittal, plus the $500 m acquisition of an aluminium smelter in Dunkirk from Rio Tinto.

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