UK Industrialist Sanjeev Gupta races ahead to acquire Indian assets

When Gupta left Ludhiana in early 1980s to study in the UK as an 11-year-old, few would have thought he would return three decades later as a saviour of multiple Indian companies

When Sanjeev Gupta left Ludhiana, Punjab, in the early 1980s to study in the United Kingdom as an 11-year-old, not many would have bet that he would return three decades later to emerge as the biggest saviour of multiple Indian companies facing insolvency proceedings in Indian courts.

Today, 46-year old Gupta-owned Liberty House, is a strong contender to take over auto parts maker, Amtek Auto, ship maker ABG Shipyard, and steel companies - Bhushan Power and Steel and Adhunik Metals.

While litigation in these insolvency cases will take some time for resolution and one can expect more surprises on the way, Gupta has made sure that his voice is heard among the big boys of corporate India which are also vying for some of these companies. "India is at the cusp of historic clean up and meteoric growth. These companies have limitless opportunities," said Gupta in a reply to email on Thursday.

"These companies fits into our strategies including Green Steel from ship-breaking , melting  and auto integrated steel," he added.

Gupta first made news in India in 2016 when he took over two closed plants of Tata Steel UK. In the same year by November, Gupta went ahead and negotiated to take over the loss-making speciality steel business of Tata Steel for 100 million pounds which was used to employ 1,700 people. These transactions saved many jobs in the UK - making him a local hero of sorts.

Gupta was approached by the Tatas after the century old company  was planning to sell its UK assets. "The Tatas realized that they made a wrong call in taking over Corus Steel at a huge premium and with financial haemorrhage, there was no other way out but to sell assets. And that's when Gupta stepped in, to buy a few steel mills in Scotland," said a former director of Tata group.

The Tata's steel mills were not the only assets which Gupta picked up. Over the years, Gupta picked up many beleaguered companies in Europe  including a stake in a bank.

The Hurdles

Some other bidders have raised objections that Gupta should not be allowed to bid for Indian companies as he defaulted on a $3 million loan to Exim Bank. Both the resolution professional and Liberty House are taking legal advice on this. This due has been cleared, said a banker but in the case of ABG Shipyard, the lenders plan to open discussion with the second highest bidder. Lenders of Adhunik are also seeking directions from the National Company Law Tribunal (NCLT) on whether to accept Liberty offer or not.

In Bhushan Power and Steel which collapsed due to its massive Rs 490 billion debt, the resolution professional had already announced Tata Steel as the highest bidder. But Liberty House moved the NCLT to make a late bid and was allowed. Liberty House later made a 15 billion higher bid than Tata Steel. Lenders now expect more delay in the resolution as the Tata would not let the company go out of its hands so easily.

"The Tatas would fight for this asset till the end as it fits in their overall strategy. How Liberty fights back and how much money it can bring to the table is to be seen," said a lender on the condition of anonymity.

When asked how he would fund these acquisition, Gupta said Liberty would fund these acquisitions with a mix of equity and debt and it would be asset specific. "Our first big step into India is with $ 5 billion investment and some 50,000 employees," Gupta said.