KordaMentha Restructuring, as Deed Administrators for the Arrium companies, has signed a binding agreement to sell the steel and mining group to GFG Alliance.
The sale is subject to approval by the Arrium Committee of Creditors, which meets next week, and the Foreign Investment Review Board, which is expected to decide soon.
Administrator Mark Mentha said: “Subject to those approvals this is a great result for Arrium employees and the city and people of Whyalla. It ensures their future and ends 15 months of uncertainty.”
Mr Mentha said GFG Alliance, owned by the British Gupta family, had submitted a modified offer for the Arrium businesses on Tuesday night.
“Taking all factors into consideration, including the timeframes required to complete a sale, KordaMentha and our sale advisers Morgan Stanley decided that GFG was an option superior to the conditional offer of the Korean alliance with whom we were negotiating,” Mr Mentha said.
Mr Mentha said once the sale was completed, the Deed Administrators would move to the next stages of the administration - finalising returns to creditors, investigating the affairs of the company and reporting to creditors.
Mr Mentha said the successful sale was a tremendous credit to all stakeholders who worked so hard to give the group the best possible chance of a future.
“This includes the employees, unions, management, local suppliers, the townspeople of Whyalla and three levels of government,” he said.
“They have stuck solid through a torrid period including gyrating ore prices, big increases in our coking coal prices and general economic uncertainty.
“Employees took a wage cut, management took a haircut, suppliers agreed to new terms and governments chipped in with funds and loan guarantees.
This is a wonderful example of how an important industry can be saved if everyone pulls in the same direction.”