Metal tycoon Sanjeev Gupta’s Belgian company Liberty Liege Dudelange has successfully appealed an April court order which called for the company to be liquidated after a judge rejected a restructuring plan for its Belgian assets.
According to a report in The Financial Times, the decision was overturned after Gupta’s Romanian steel subsidiary Liberty Galati provided financial support for its Belgian counterpart in the form of a debt-to-equity swap worth €52.5mn as well as €3mn in cash. This resulted in raising the company’s net assets to €81,946, which places it above the mandatory threshold of €61,500 necessary to be compliant with the Belgian companies and associations code.
Liberty Liege Dudelange also filed its overdue accounts, a further requirement from the court to grant the appeal. The decision provides temporary relief to Gupta’s GFG Alliance group, which is facing court battles in several jurisdictions, and has been attempting to refinance its businesses since the collapse of the group’s major lender Greensill Capital in March last year amid allegations of fraud.
The UK’s Serious Fraud Office and French police are investigating GFG Alliance companies over suspected fraud and money laundering. In late April French police conducted searches at properties, including metalworks linked to Gupta, while the SFO requested documents including company balance sheets and correspondence related to their probe, which was launched a year ago.
Toker Ozcan, who was recently appointed as chief executive of Greensteel EMEA for Liberty Steel, stated that the company welcomed the court’s decision and would restart production at the mill as soon as possible.
Source: The Financial Times