As a resume writer and employment services expert, no one likes to read stories like these.
Four years ago I wrote a story for both The Advertiser and InDaily, which said Sanjeev Gupta’s empire was built on debt. Gupta was then seen as Superman, so the story never saw daylight.
To cut along story short, Gupta and his company, GFG Alliance, borrowed a large amount of money from Greensill Capital, which lends money by putting a twist on supply chain financing.
Greensill went into liquidation yesterday and the collapse has cast a shadow over Gupta, who relied heavily on the firm to fund his rapid spree of acquisitions of moribund industrial assets, including the Whyalla steel mill.
Banks and the financial sector have cut ties with the financier, fearing it’s a house of cards.
Gupta was a commodities trader before he started snapping up ailing power, steel and aluminium plants in the UK and across Europe. He now operates in 35 countries with a 35,000 strong workforce.
No one really knows how he turns a profit from the ailing Whyalla plant. He was going to replace the ageing blast furnace with a $1 billion-plus electric arc furnace and modern steel-making facility by 2024 but that has been put on hold.
The problem is, if Greensill goes down, there’s a good chance Gupta will have to either sell the Whyalla plant or close it.
Last year Gupta tried to borrow money from the state government and there were rumours contracts were getting paid late.
The exact financial relationship between the two groups, and the extent of their financial links, remains is a mystery, but with Greensill’s empire in ruins, Whyalla’s future could once again be under a cloud.