The government has stepped in to take control of Liberty Steel’s speciality steel operations in South Yorkshire after the High Court ruled the business insolvent. Around 1,450 jobs at Rotherham and Stocksbridge have been placed under the oversight of the Official Receiver and restructuring firm Teneo, who have been appointed to manage the sites and ensure staff continue to be paid.
The ruling ends months of uncertainty for Speciality Steel UK, part of Sanjeev Gupta’s GFG Alliance, which has not produced steel for more than a year amid a shortage of working capital and dwindling orders. The decision to install government-backed managers means the plants will be kept operational while options for their future are considered.
Ministers made clear that the intervention is intended to safeguard vital industrial capacity and prevent a sudden shutdown of facilities that supply speciality grades used across automotive, defence and energy sectors. The move follows a similar rescue at British Steel’s Scunthorpe works earlier this year, underlining the growing willingness of government to act directly to preserve core parts of the UK’s manufacturing base.
For the workforce, the action provides short-term reassurance after months of stalled production. Furnace operators, metallurgists and maintenance engineers will remain in place as the sites are stabilised, though the long-term outlook depends on whether a buyer or new funding package can be secured. A proposed pre-pack rescue led by Mr Gupta and backed by BlackRock was rejected by the court in favour of compulsory liquidation and state-supervised management.
The government’s powers to intervene were bolstered by the Steel Industry (Special Measures) Act passed earlier this year, giving ministers the ability to keep essential steel assets running in the event of insolvency. Industry observers say the latest move sets a precedent for closer state involvement in strategic industrial operations, particularly as the sector faces the twin pressures of high energy costs and the transition to low-carbon steelmaking.
