In introducing Sanjeev Gupta, executive chairman and CEO of GFG Alliance, London, Peter Marcus of World Steel Dynamics (WSD), Englewood Cliffs, New Jersey, described him as a person who “likes to pursue disruptive growth.” With the recent opening of the Liberty Steel mill in Georgetown, South Carolina, Gupta has brought his disruptive tendency to the U.S. steel market.
Gupta spoke before attendees of World Steel Success Strategies XXXIII, which American Metal Market (AMM) Events and WSD hosted June 25-27 in New York City.
He described GFG Alliance as “a global grouping of independent businesses with a focus on natural resources, renewable energy, metal manufacture and engineering.” The company’s four verticals—Liberty House Group, SIMEC Group, Wyelands and Jahama Estates—are in the metals, energy and natural resources, financial services and real estate sectors.
GFG Alliance has a presence in 30 countries and operates 200 mills. Gupta said two-thirds of the business is industrial, which continues to grow annually, while trading comprises one-third of the business.
He described GFG Alliance as a “family business that thinks generationally.”
The company’s business model is to create value through “decoupled integration of natural resources, industry and financial services,” he said. Each of the company’s businesses is integrated to service other parts of GFG as well as external customers. According to Gupta’s presentation, this model “enables economic value creation for the core industrial group with full benefits of integration.”
The acquisition and reopening of the Georgetown steelworks marks the company’s first major step into the U.S. market. The mill includes two 500-kiloton electric arc furnaces (EAFs) and a 750-kiloton rod mill. Melting at the facility began June 25, he said.
“U.S. steel supply and demand is ripe for the Greensteel model as one of largest scrap exporters and importers of steel,” Gupta said. Greensteel refers to the company’s business model, which its website says “aims to recycle and upcycle the growing mountain of scrap steel using electric arc furnaces powered by renewable energy.” Through Greensteel, “Raw materials and resources are secured locally to make world-class products that sell both nationally and globally,” the company says.
GFG plans to expand up and down the metals value chain in the U.S. under the Liberty pillar, Gupta said, which includes adding scrap metal processing capacity, additional steel mills and even aluminum production capacity.
To that end, the company has acquired a scrap processing operation in Tampa, Florida.
Gupta said his company is primarily interested in scrap to feed its EAFs but also is interested in direct-reduced iron (DRI) and hasn’t ruled out expansions or acquisitions that involve DRI production.
When asked about the Georgetown mills’ succession of previous owners and closures and why GFG will find success where they haven’t, Gupta said, “Being a private company, we have a higher tolerance for the bad times. We are committed to keeping businesses open.” He added that the company has not closed any operations since its founding, which was in 1992.