{"id":376873,"date":"2026-01-18T12:47:07","date_gmt":"2026-01-18T12:47:07","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/376873\/"},"modified":"2026-01-18T12:47:07","modified_gmt":"2026-01-18T12:47:07","slug":"royal-navy-shipbuilder-in-limbo-owing-to-cash-shortage-at-liberty-steel-plant-steel-industry","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/376873\/","title":{"rendered":"Royal Navy shipbuilder in limbo owing to cash shortage at Liberty Steel plant | Steel industry"},"content":{"rendered":"

A shipbuilder for the Royal Navy<\/a> faces an uncertain wait for the steel to build three warships because of a shortage of cash at the Scottish steel mill that has won the contract.<\/p>\n

Liberty Steel Dalzell in Scotland<\/a> has been unable to start production in earnest because there is \u201cno cashflow to buy slab\u201d, despite an order to supply 34,000 tonnes of metal plates to build fleet solid support (FSS) ships for the navy, according to two sources with knowledge of the situation.<\/p>\n

Sir David Murray, a Scottish metals magnate, said the UK government should step in, as it has done with other steelworks, to pressure Liberty Steel to pass over control of the plant. He has previously told the government he would be willing to step in and run the business.<\/p>\n

The cash shortage at Liberty is a sign of the continued financial troubles facing companies owned by the under-pressure metals tycoon Sanjeev Gupta<\/a>. Gupta has lost control of several parts of his GFG Alliance empire since the 2021 collapse of his key lender, Greensill Capital<\/a>.<\/p>\n

Gupta in August lost control over Speciality Steel UK<\/a> in South Yorkshire because it was \u201chopelessly insolvent\u201d. The Dalzell mill has not filed accounts for five years, and Gupta is facing prosecution over failure to file accounts, as well as a long-running fraud investigation by the Serious Fraud Office.<\/p>\n

The 216-metre FSS ships, designed to carry munitions, food and other supplies for the navy\u2019s Royal Fleet Auxiliary, are due to be built in Belfast by the Spanish state-owned shipbuilder Navantia. The first ship, RFA Resurgent, is expected to be delivered in 2031.<\/p>\n

The FSS ship orders were meant to secure employment in the UK, and to rely as much as possible on UK suppliers. Navantia took over the Harland & Wolff site in Belfast last year, after its British owner collapsed<\/a>.<\/p>\n

The cash shortage at Liberty Steel has left it unable to buy the slabs of steel it needs from British Steel, although workers have continued to be paid 80% of their salaries. Small trial runs in November were only able to process about 1,000 tonnes \u2013 or about three days of output \u2013 sources said. Liberty has hopes of restarting production in the coming weeks, but some industry figures have expressed scepticism over its plans.<\/p>\n

Murray, a former owner of Rangers football club<\/a> in Glasgow, said he wanted to take over the running of the plant, and that it could be profitable within two years with the injection of enough cash to pay for raw materials and working capital with an investment of \u00a350m.<\/p>\n

Murray tried to buy the plant in 2015 before it was sold to Gupta in a deal brokered by the Scottish government. The government chose Gupta and lent him \u00a37m in part because he also promised to turn around the Alvance aluminium smelter in Fort William in the Scottish Highlands, and to open an aluminium car wheel factory.<\/p>\n

Alvance was loss-making in the year to March 2021. It has failed to file accounts since then, although social media accounts suggest it is still operating as normal.<\/p>\n

The wheel factory was never opened, and the \u00a37m loan is still outstanding. The other leading creditor is thought to be an energy company also owned by Gupta.<\/p>\n

Murray said: \u201cIt\u2019s a terrible error of judgment to remain idle when the British economy should have the capability of rolling wide steel which could be supplied to customers like Harland & Wolff and BAE Systems with new naval contracts 17 miles from the mill. We cannot going forward rely on importing everything. We don\u2019t know what\u2019s coming round the corner.\u201d<\/p>\n

Liberty Steel approached Murray two years ago trying to sell the Dalzell plant as a going concern. However, Murray refused the offer because he believed it should instead be sold via a \u201cpre-pack administration\u201d, in which a sale is lined up in advance of entering the insolvency process.<\/p>\n

A production restart at Dalzell would provide a welcome large customer for British Steel\u2019s slabs from Scunthorpe plant. The Westminster government took control of the plant from its Chinese owners, Jingye Steel<\/a>, in April, but has so far spent \u00a3274m<\/a> propping up the lossmaking operation.<\/p>\n

A Liberty Steel spokesperson said the plant \u201cis fulfilling\u201d the Navantia order and said trial production runs \u201care expected to shortly resume\u201d.<\/p>\n

The spokesperson said: \u201cWith the positive momentum from this significant contract Liberty aims to attract more business through a pipeline of select projects.<\/p>\n

\u201cWhile sales conditions for merchant plate have been challenging due to competition from cut-price imports, recent UK trade actions coupled with beneficial UK\/US tariffs will enable Dalzell to ramp up production of its high-quality plate and continue to support UK industrial policy and jobs.\u201d<\/p>\n

Navantia UK declined to comment.<\/p>\n","protected":false},"excerpt":{"rendered":"A shipbuilder for the Royal Navy faces an uncertain wait for the steel to build three warships because…\n","protected":false},"author":2,"featured_media":376874,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[59,57,58,50,56,54,55],"class_list":["post-376873","post","type-post","status-publish","format-standard","has-post-thumbnail","category-united-kingdom","tag-gb","tag-great-britain","tag-greatbritain","tag-news","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/376873","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=376873"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/376873\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/376874"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=376873"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=376873"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=376873"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}