AIP says it takes ownership of Gupta's Belgian aluminium mill after default

·1-min read
FILE PHOTO: Steel tycoon Gupta arrives at the Department for Business, Innovation and Skills in London

LONDON (Reuters) - Buyout firm American Industrial Partners said on Tuesday it had acquired ownership of an aluminium rolling mill in Belgium after a default on debt by a unit of the GFG Alliance owned by commodities tycoon Sanjeev Gupta.

GFG said it has launched legal actions to fight AIP's move.

This would mark the second asset AIP has acquired that was previously owned by GFG, which has been struggling to find refinancing after supply chain finance firm Greensill filed for insolvency in March last year.

Last October, AIP took control of a smelter in Dunkirk, France that is Europe's largest primary aluminium producer.

AIP said in a statement it had provided loans to Duffel, which went into default in July last year and had failed to be refinanced since then.

"As a result, AIP is now the legal and beneficial owner ... and does not anticipate any disruption to normal operations of the business," it added.

GFG said in a statement that AIP had refused to accept debt payments for both Duffel and the Dunkirk smelter.

"GFG is committed to take all steps possible to fight against AIP's premeditated, predatory manoeuvres to seize our Dunkirk and Duffel assets on the cheap."

Duffel, which has capacity for 250,000 tonnes a year of rolled aluminium products, specialises in supplying the auto industry and has about 1,000 full-time workers.

Separately, the Liberty Steel group owned by GFG said on Tuesday it had reached a standstill agreement with its largest creditor Greensill Bank on debt facilities for its European business.

Gupta's conglomerate has a global web of businesses in steel, aluminium and energy.

(Reporting by Eric Onstad; editing by David Evans)