The UK government has rejected the request made by UK-based Liberty Steel Group, part of the GFG Alliance, for £170 million in financial support to cover its operating expenses and recent losses amid the financial difficulties relating to Greensill Capital, the main lender to GFG Alliance, according to media reports. The decision is based on the concerns of ministers regarding the structure of the company and whether any financial support would remain in the UK, as SteelOrbis understands.
The rejection has added to the pressure on GFG Alliance, while putting 5,000 jobs at risk in the UK. The company continues to seek new funding sources.
“Discussions to secure alternative long-term funding continue to make good progress and, while this takes place, we have asked all of our businesses to manage cash carefully. We will continue to work closely with the unions and our employees to identify the most effective ways of supporting the business and preserving jobs,” a representative of the company said.
British Prime Minister Boris Johnson had promised to do whatever would be necessary to save jobs in the UK steel industry, as SteelOrbis previously reported.