In 2017, Sanjeev Gupta’s GFG Alliance bought Arrium out of voluntary administration, taking over its struggling Whyalla steelworks and promising to maintain its workforce.
The global steel arm of GFG Alliance, Liberty Steel Group, last week announced it would shed 354 jobs in the United Kingdom because of “challenging” market conditions.
Asked whether there would be any job cuts at Whyalla, a GFG Alliance spokesperson told InDaily that the company had no current plans for major local redundancies, but that employees would remain the company’s priority “should any change occur in the future”.
“At present, we do not have any plans for widespread workforce changes,” a GFG Alliance spokesperson said in a statement.
“Family is a core value and should any change occur in the future we will continue to focus on our people and employment as a priority.”
The Whyalla steelworks is the main employer in the South Australian town, located about 380kms north of Adelaide.
According to the company, the steelworks currently employs about 1200 people.
The GFG Alliance spokesperson said that the company was looking forward to a positive future and an exciting year in Australia.
“Whyalla & GFG Alliance in Australia benefit from being an integrated primary steel producer and we believe there is a positive future for the steel industry in Australia and are committed to the transformation of Whyalla,” the spokesperson said.
“Since acquiring the business out of voluntary administration two years ago, we have spent hundreds of millions of dollars improving the operations, however there is still significant investment required.
“It’s an exciting year with number of projects ready to get underway soon, (which) will grow our businesses and help safe guard local jobs into the future.”
But the spokesperson did not respond to questions about how the Australian steel industry might be insulated from difficult market conditions affecting UK steel makers.
Describing the reasons for the UK job cuts last week, Liberty chief executive Cornelius Louwrens reportedly said: “the steel industry in the UK is facing challenging conditions and we have made the difficult decision that there is a need to reduce the workforce at a handful of locations, in order to make them sustainable for the long-term”.
“It has always been our intention, and always will be, to avoid compulsory redundancies.
“Our commitment to these steelworks, and our ambition for the future of this business, is as strong as ever.”
Last year, Gupta reportedly approached the federal government for financial assistance for his Australian business.
A GFG Alliance spokesperson told The Sydney Morning Herald and The Age in August that the company had been “in discussions with the state and federal government since the acquisition of Arrium from administrators in 2017 given the critical nature of the business to South Australia and the importance of steel making nationally”.
“In that time, GFG has invested significantly to stabilise the business,” she is quoted as saying.
“Having done so, GFG is finalising its business plan and will continue to meet with governments to assess what levels of support may be required to deliver a transformation that provides a sustainable long-term future for steel making in Whyalla.”
Australian Manufacturing Workers’ Union state secretary Peter Bauer told InDaily the union had not heard any indication of job cuts from the employer and that, under the relevant enterprise agreement, any redundancies would have to go through a consultation period.
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