The Liège-based company owns two steel plants in Flémalle and Tilleur and currently employs around 700 people. It will be up for liquidation due to outstanding debt.
Three receivers, tasked with selling company assets on behalf of lenders, have been appointed by the court to find a buyer or buyers for Liberty Steel's two steel plants.
Faced with financial difficulties since the bankruptcy of its main creditor, Greensill, the Liberty Steel group has been on the brink of collapse for months. In the meantime, Sogepa (the equivalent of SNCI in Wallonia) will cover the steelmaker's costs.
According to initial reports in Liège, the steelmaker has debts of around €50m. The court's decision has been positively received by the Belgian unions in the Liège region, which had been hoping to turn the page on Liberty Steel for several months.
Arcelormittal and Russian steelmaker NLMK are on the list of potential buyers, according to Belgian media. The Luxembourg-based steel giant has not confirmed the information. Meanwhile a takeover of the two sites by a Russian company also seems difficult to imagine in the current geopolitical context in the context Russia's invasion of Ukraine.
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The dissolution of the group's facilities in Liège, which supply Liberty Steel Dudelange, is expected to have significant repercussions in Luxembourg. It should be noted, however, that the Belgian court's decision does not affect Liberty Steel's Luxembourg site, as these are two different entities. However, Luxembourg unions have already requested an emergency meeting with the Dudelange management. They have also scheduled a meeting with the labour minister Georges Engel (LSAP) and economy minister Franz Fayot (LSAP).
During a press conference on 13 April Fayot said he was “prepared for the possibility of a judicial liquidation in Liège and the consequences for the Dudelange site”, meaning an eventual bankruptcy. The minister also indicated that “several potential buyers” have already been identified.
The liquidation of the Liège site spells trouble for Liberty Steel’s Luxembourg plant in Dudelange. The two steel production sites are partnered and Dudelange operates with material furnished from Liège.
Since the collapse of Greensill, trade unions in Luxembourg have warned of knock-on effects for the site in Dudelange, which temporarily wound down production, with staff working reduced hours due to materials shortages.
Liberty Steel in a restructuring attempt in June site with plants in Romania to merge downstream businesses.
The court reached its verdict around 11am on Wednesday. More information to follow.
This story was first published in French on Paperjam. It has been translated and edited for Delano.