The proposed restructuring should reduce the company's debt
Liberty Steel has announced a plan to restructure its Specialty Steel UK business. This is stated in the company’s press release.
As noted, the proposed plan will significantly reduce the company’s debt and increase its ability to meet future demand. The division has secured support for the plan from its major customers.
All creditors will be presented with a detailed proposal and given the opportunity to vote on the plan in court, the company said.
The proposed restructuring will have no impact on the unit’s employees.
After the implementation of the plan, the company says, Specialty Steel UK will be better positioned to raise new capital and further expand its operations in strategic segments and the production of environmentally friendly products.
“After making significant progress to stabilise the business and refocus it on high value specialist products, we’re now addressing the debt position of the company to create a stronger speciality business going forward,” said Jeffrey Cable, Chief Transformation Officer of Liberty Steel Group.
The company said that Specialty Steel UK’s strategic focus on specialty steel grades for the aerospace, defense and energy sectors has helped mitigate the long-term competitiveness challenges faced by the British steel industry. The proposed plan is designed to significantly reduce the division’s debt and avoid bankruptcy.
Last January, Liberty Steel UK announced its intention to focus on the production of high-cost alloy steel at its Specialty Steel UK plants in Rotherham, Stokesbridge and Brinsworth. The unit was to increase its production during the year to break even by September 2023.
As stated, Liberty Steel Newport and Liberty Performance Steel West Bromwich processing plants were to be shut down due to the liquidation of unprofitable businesses, as they were to be turned into sales and distribution centers for the company’s products. Production at the Rotherham plant was also planned to be reduced.
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