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Liberty House submits letter of intent to Tata Steel
Liberty House Group today (3rd May 2016) formally submitted the required letter of intent to Tata Steel Europe containing its indicative bid for the entire issued share capital of Tata Steel UK.
The document, which was sent from Liberty’s international headquarters in London, states the company’s intention to bid for all of Tata Steel’s UK assets, excluding its Long Products division which is in the process of being sold separately and the Scottish Plate Assets that Liberty already acquired from Tata.
The bid is based on Liberty’s GREENSTEEL business model and would involve a transition from steelmaking in blast furnaces to recycling steel in electric arc furnaces over time while ensuring the company continues to meet key customers’ quality requirements. Steelmaking would be ultimately powered by renewable energy sources. Liberty believes the UK steel industry can achieve long-term viability if based on an agile, sustainable, non-cyclical model which integrates liquid steel-making from recycling with downstream production and the manufacture of advanced engineering products.
In order to take the bid forward Liberty has appointed an internal project team and a panel of leading external advisers to work on this acquisition, dubbed “Project GREENSTEEL Pluto”.
The 12-strong team will be led by Liberty Executive Chairman, Sanjeev Gupta, who will be working closely with Jay Hambro, Group Chief Investment Officer of the GFG Alliance and Chief Executive of the SIMEC Group, and Jon Bolton, Chief Executive of Liberty Steel UK Plates and UK Steel Development. Mr Bolton, former Director of Tata Steel, is also Chair of the trade body, UK Steel and co-chair with Secretary of State, Sajid Javid of the UK Steel Council
The internal team includes senior executives with extensive experience in the global and UK steel industry, as well as specialists in the legal, environmental, finance and human resource fields. Five of the team have previously worked at senior level within Tata.
Liberty is being supported by a panel of financial advisers led by international investment bankers, Macquarie Capital (Europe) Limited, with the State Bank of India Capital Markets as co-financial advisers.
In addition to specific support offered by Macquarie Bank and a host of other banks and funds, GFG has existing banking relationships with over 30 banks globally. GFG also has an independent investment division which includes businesses in banking and fund management, specialising in supply chain finance.
The panel of advisers also includes global lawyers, Clyde & Co; leading worldwide accountants, Grant Thornton; and leading financial advisers, Deloitte, who will provide guidance on pension issues.
International consultancy, Wardell-Armstrong, will advise on environmental issues, specialist analysts CRU will provide commercial advice and research data while specific support regarding electric arc furnaces will come from Primetals Technologies, a joint venture between Siemens and Mitsubishi.
Professor Julian Allwood, Professor of Engineering and the Environment at the University of Cambridge has also joined the team of external advisers.
Liberty will not be adding further to this statement at present.
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