MIKE SMITHSON: Why billionaire who saved Whyalla steelworks Sanjeev Gupta is a classic ‘gunna’

The ‘white knight’ who saved the Whyalla steelworks in South Australia is losing the shine on his armour.

British billionaire Sanjeev Gupta rode into the Upper Spencer Gulf city in 2017 and flashed his cheque book at the ailing steelworks which faced closure under then-owner Arrium after years of declining profits and ageing equipment.

He was fawned over by federal and state politicians who couldn’t show him enough gratitude for buying the plant, which is the lifeblood of the town and provides 900 direct jobs.

But successive governments have discovered Gupta is big on promises and shorter on delivery.

Whyalla is a vital cash cow in his GFG (Gupta Family Group) global empire which also boasts steel-making facilities across Europe.

As a further sign of goodwill, he then tipped sponsorship money into Port Adelaide Football Club with his GFG logo prominent on its AFL guernsey.

It all sounds good on paper, but there have been many pitfalls.

Things started going sour in 2019 when loud alarm bells rang.

Many local contractors to GFG’s Whyalla operation, working under the Liberty Steel banner, reported they hadn’t been paid for months.

They were forking out for their staff wages, but the steel maker was holding off paying contractors resulting in many local companies almost bled dry.

The then-SA Small Business Commissioner stepped in on their behalf and read the riot act to the company.

Their payment policy was forced into greater transparency and that aspect improved.

In recent times Gupta promised to install a new state-of-the-art electric arc furnace to lift antiquated steel making out of the coal-fired dark ages.

In Aussie vernacular, Sanjeev Gupta is a classic ‘gunna’.

State and federal governments have promised to tip in $110 million dollars of taxpayer funds to give it a kick along.

The $500 million technology was earmarked for installation by 2025 and that’s not a moment too soon.

SA’s progressive Premier, Peter Malinauskas, has talked up a new hydrogen plant to help fuel the steel-making process, but also at an enormous taxpayer expense.

It’s a crucial piece of the Gupta vision to decarbonise his SA steel-making operations by the end of the decade.

The SA Energy Minister obviously had his doubts on the timeframe and last month visited the Italian furnace manufacturer to find out where it was at.

Between meeting them and meeting up with Sanjeev Gupta at a global energy conference in Rotterdam, GFG dropped a media release into the mix announcing the new furnace had been delayed by two years.

It blindsided Minister Tom Koutsantonis, to the point that he had strong words with Gupta when they met face-to-face.

Since then, the irritated energy minister has publicly advised Gupta to get on with it, without further delays.

Let’s face it.

In Aussie vernacular, Sanjeev Gupta is a classic ‘gunna’.

He’s constantly going to achieve big things for Whyalla which then appear to go into the too hard basket or far over the horizon.

The mere fact that he didn’t inform the SA government before issuing a media release with a bad news announcement speaks volumes.

Gupta announced a steel-making mega plant soon after he took over, claiming it would increase production tenfold.

That didn’t happen.

He also made much fanfare in 2018 about a proposed $350 million solar farm with 780,000 panels to generate jobs and provide green power for the entire area.

By 2021, troubled times with his failed financier forced him to put that on hold.

Another mirage.

It’s well known his profitable Whyalla steel-making props up his other European operations which are struggling.

In Czechia, work has stopped on upgrades because of an unpaid power bill.

The energy supplier subsequently cut power to the plant last December after six months of missing payments – does that pattern sound familiar?

It’s a Catch-22.

Whyalla’s economic survival depends on the steelworks, which supports the city’s entire economy, not to mention giving this country much-needed manufacturing sovereignty.

Long steel products supply the construction industry and help build and maintain Australia’s rail line network.

Gupta must be commended for saving it from possible oblivion seven years ago.

The stakes are high for workers and their families in the steel city, clinging to hope of an ongoing and permanent future.

Is he ever ‘gunna’ achieve his grand plans?

Many eyes from Canberra, all the way to Whyalla are watching…and waiting.

Mike Smithson is Chief Reporter and Presenter with Channel 7 Adelaide.

He’s covered Whyalla’s changing economic fortunes for 25 years