Yahoo Finance Sanjeev Gupta continues on acquisition trail with second US deal in a week
Entrepreneur Sanjeev Gupta is continuing his ambitious expansions plans in the industrial sector with a bid for a US steel sector business - the second such deal in less than a week.
Mr Gupta’s UK-based GFG Alliance - which includes the Liberty industrials group and Simec mining and energy businesses - is bidding as part of a consortium with ERP Iron Ore and institutional backers for Minnesota-based Mesabi Metallics.
Assets they are trying to buy include a plant which produces iron ore pellets, an important feedstock for the steel-making process.
Construction of the plant in Nashwauk stalled after India’s Essar walked away in 2015, having pumped $1.8bn into the project, which then went through complex bankruptcies.
As well as the 7m tonne a year pellet plant in north-east Minnesota, the deal also includes huge deposits of iron ore, estimated at almost 2bn tonnes, across the so-called “iron range”.
The potential acquisition follows on from Friday’s announcement that Liberty had agreed a deal with ArcelorMittal to buy the mothballed Georgetown steelworks in South Carolina - the group’s first move into the US.
The value of the consortium bid for Mesabi is understood to be $250m. Liberty's involvement in the acquisition, along with last week's South Carolina deal, takes the British-based company's investment in the US to well in excess of $100m.
“We see this as a time of renewed opportunity for growth of American industry,” said Mr Gupta. “We have the breadth and depth of skill and experience on that opportunity.”
Liberty has been an acquisitive buyer of distressed steel and industrial assets in the UK, snapping up operations from sellers including Tata and Rio Tinto, and rescuing car components maker Covpress and large parts diversified industrial group Caparo out of administration.
