The Whyalla steelworks in South Australia has faced severe financial challenges, incurring losses of $1.5 million daily prior to its recent administration. The facility, owned by OneSteel Manufacturing, now owes an astonishing $1.3 billion to various creditors.
These figures were disclosed during the inaugural creditors’ meeting following the South Australian government’s intervention. Among the creditors, Sanjeev Gupta’s GFG Alliance and related firms assert that they are owed over $500 million as part of the outstanding debts.
Mark Mentha, the appointed administrator, has indicated that determining the precise amount owed to the Gupta-related entities will take time. One significant factor contributing to the financial strain is the prolonged shutdown of the blast furnace at the steelworks, which has exacerbated losses during this challenging period.
In a statement expressing their disappointment, GFG Alliance noted their continued belief in the strategic significance of Whyalla and their commitment to supporting a sustainable long-term solution for the steelworks’ future.
Meanwhile, Premier Peter Malinauskas has confirmed that funds from the $2.4 billion rescue package, jointly supported by state and federal governments, are beginning to reach the creditors’ accounts. This financial support is critical as stakeholders work towards a resolution.
Overall, the situation remains precarious for the Whyalla steelworks as it navigates the aftermath of this financial crisis.