UK 1,500 Jobs at Risk as Liberty Steel’s SSUK Collapses

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Picture courtesy of BBC/Spencer Stokes

 

The UK's third-largest steelworks has crashed under government control, posing an uncertain future for nearly 1,500 workers in Rotherham and Sheffield. Creditors, owed hundreds of millions, pushed through a compulsory winding-up order against Speciality Steels UK (SSUK), part of Sanjeev Gupta's Liberty Steel empire.

 

Now, the fate of the company lies in the hands of the official receiver and consultancy firm Teneo, as the government chips in to cover ongoing wages and plant costs while searching for a buyer. Liberty Steel's Jeffrey Kabel expressed deep disappointment, claiming they were the best for the job, having invested significantly in the company.

 

Gupta’s attempts for a four-week adjournment to place SSUK in "pre-pack administration" failed, thwarting plans to reacquire the business with backing from investment giants BlackRock and Fidera. Citing the company’s insolvency, a judge noted its dire finances—£600,000 in the bank against a £3.7 million monthly wage bill. Lawyer Ryan Perkins argued that UK steelmaking would benefit from selling the company's assets through independent special managers.

 

The Department for Business and Trade disclosed interest from third parties in revisiting steel production on the sites, matching government aims for rejuvenation. The issues faced by Liberty Steel Group followed Greensill Capital's collapse, which left billions owed to investors, including UBS and Citibank. Gupta's plan to buy back SSUK would have reduced its debt burdens significantly.

 

The government now bears the operational and financial risks for SSUK, which has hardly produced steel for over a year. Financial chaos surrounds Liberty Steel, as its Singapore-based parent is also embroiled in insolvency. Despite setbacks, the government stated its support for the future of the UK steel industry, echoing past interventions like British Steel's Scunthorpe plant takeover, reported the BBC.

 

The steel sector grapples with high energy costs, cheaper foreign imports, and US export tariffs initiated under Trump. Reflecting industry woes, the GMB union lamented the situation as another "tragedy for UK steel". Workers, some on partial furlough, await clarity on pay and pensions, eager to restart steel production.

 

  Adapted by ASEAN Now from BBC 2025-08-22