- Press Release
Sanjeev Gupta’s GFG Alliance to acquire Tasmania-based TEMCO
GFG Alliance has today confirmed that it has entered into a binding sale and purchase agreement with an entity owned by South32 Limited and Anglo American Plc for the hydro energy-powered Tasmanian Electro Metallurgical Company (TEMCO) smelter in Bell Bay, near George Town in northern Tasmania.
Subject to relevant approvals, TEMCO will join LIBERTY Steel Group, part of the GFG Alliance family, which includes the Whyalla steelworks, SIMEC Mining, and InfraBuild in Australia. This will secure the site’s 250 jobs.
The TEMCO facility has four submerged electric arc furnaces, including a sinter plant and has the capacity to produce around 150ktpa of high carbon ferromanganese and 120ktpa of silicomanganese which is used in the production of steel.
LIBERTY Steel Group, eighth largest steelmaker in the world outside China, purchases a significant volume of ferro alloys every year for its global steelmaking operations. TEMCO is an existing supplier to LIBERTY’s Australian operations.
GFG Alliance Executive Chairman, Sanjeev Gupta said the TEMCO facility will be an important upstream addition that will strengthen its steel making capability in Australia and globally.
“This acquisition will further enhance LIBERTY’s drive to be self-sufficient and fully integrated across the supply chain, complementing our iron ore production in Whyalla, coking coal in Tahmoor and our Cultana Solar Farm to be built in Whyalla.
“By investing in key inputs, such as ferromanganese and silicomanganese we are able to generate value across the supply chain to ensure Australia has a sustainable and globally competitive steel manufacturing sector.
“It will also help neutralise the volatility in the markets, providing us a reliable supply at a stable cost.
Mr Gupta said the acquisition is in line with his strategy to further expand his GREENSTEEL strategy and complements his goal to be carbon neutral by 2030, known as CN30.
“By embracing Tasmania’s plentiful supply of renewable energy, particularly the ability to power the submerged arc furnaces from Hydro Tasmania, the TEMCO facility will support our goal to be carbon neutral by 2030.
“Whether used in a blast furnace route or an electric arc furnace route, ferromanganese and silicomanganese will continue to have a role as important inputs for making steel products, the fact we will be able to produce these inputs using renewable energy is a real boost to our GREENSTEEL strategy.
“While living in Australia, I visited Tasmania a number of times and was impressed by its natural beauty, its commitment to renewable energy and the diversity of its industries. Most of all I was inspired by the Tasmanian Government’s passion for green industry and underpinned by long-term, sustainable and quality jobs.
“The welcome and encouragement the Government extended to me to invest in Tasmania, played no small part in the conclusion of this agreement today. I’m certain it will lead to GFG taking a leading role in the future development of industry in Tasmania.
“I am passionate about industrial communities with a long heritage, their commitment to see their facilities succeed is a testament to the human spirit. I look forward to visiting George Town again as soon as possible,” Mr Gupta said.
Robert Evans, General Counsel and Head of Business Development at GFG Alliance who led this transaction, grew up in Tasmania and has firsthand knowledge of how important TEMCO and other similar manufacturers are to the local economy, said: “It’s most rewarding to be involved in a transaction by which GFG can ensure the sustainable future of this business and establish a platform in Tasmania for future growth and investment”.
The agreement remains subject to regulatory approval.
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