Steel tycoon Gupta weighs future of Jaguar supply unit
12 November 2019, 11:36 | Updated: 12 November 2019, 12:10
The industrial conglomerate Liberty House is reviewing its future ownership of a business which is among the biggest automotive industry suppliers in the Midlands.
Sky News has learnt that the company has hired advisers to examine strategic options for Liberty Pressing Solutions (LPS), which it bought in 2016 when it traded under the name Covpress.
Based at a plant in Canly in Coventry, LPS has historically employed more than 700 people and supplies pressings and welded assembles to Jaguar Land Rover (JLR), Renault and Caterpillar, the manufacturer of industrial machinery.
Sources said that a sale was among the options being considered, but that Liberty was also explore acquisitions and joint venture opportunities.
Liberty House acquired Covpress after a stint in administration, which was triggered by ongoing cashflow problems.
A possible sale comes at a time of renewed uncertainty for Britain's automotive industry, with Honda set to close its Swindon plant in two years' time, Ford's Bridgend factory planning to shut down, and growing fears for the future of Nissan's factory in Sunderland.
Consolidation in the global car industry, including the takeover of General Motors' Vauxhall and Opel brands by PSA Groupe.
Grant Thornton, the accountancy firm, has been engaged to oversee the review of LPS.
A source close to Liberty House said the prospects for a successful sale would be improved by the decision by the current owner to retain LPS's defined benefit pension scheme, which is several million pounds in deficit.
It was unclear on Tuesday how much LPS might be valued at in any transaction, or who the prospective bidders or partners were.
News of the attempt to sell LPS has emerged weeks after Liberty House held fresh negotiations with the Official Receiver and ministers about an offer for British Steel.
The UK's second-largest steel producer, which collapsed into liquidation in May, is now close to being sold to China's Jingye Group following the termination of exclusive talks with Turkey's Ataer Holding, which is owned by the country's military pension scheme.
Liberty House said recently that it aimed to become the first carbon-neutral steelmaker by 2030.
However, Sanjeev Gupta's company has also faced searching questions about its financing and corporate governance following a string of large European steel takeover deals.
A spokesman for Liberty said: "Liberty has engaged advisers to undertake a strategic review for Liberty Pressing Solutions.
"Options under consideration include the possibility of strategic partnerships, joint ventures, new business development and acquisitions as well as potential investors for the business.
"It is well documented that the automotive market and its supply chain in the UK is challenging and needs consolidation.
"We're committed to securing a successful future for the business, and for the people who work in it."
(c) Sky News 2019: Steel tycoon Gupta weighs future of Jaguar supply unit