GFG Alliance faces having to pay fines as it finalises accounts for Alvance British Aluminium - formerly Liberty Aluminium Lochaber - and its power plant, Simec Lochaber Hydropower.
Companies House records show that Alvance is nearly 11 months late in filing its accounts for the year to the end of March 2020, while the group is more than six months late filing for various entities associated with the hydro business.
Sanjeev Gupta's group acquired the 90 year-old smelter and its hydro-electric plant from mining giant Rio Tino for £330m deal in 2016.
It is a legal obligation for companies to maintain paperwork in a timely manner, although fines only amount to just £1,500 for each company.
GFG admitted the filing of its accounts were “delayed due to the disruption caused by Greensill Capital’s collapse”, adding that: “We are in contact with Companies House and are now finalising these accounts which will be filed in due course.”
Liberal Democrat economy spokesman Willie Rennie said the inability to complete the accounts could be a “warning sign” that jobs are at risk at the plant.
GFG has been forced to defend its complex group finances since its main financial backer Greensill Capital collapsed last year, prompting a Serious Fraud Office (SFO) investigation into “suspected fraud, fraudulent trading and money laundering” at GFG, raising concerns for its 35,000 worldwide workforce - including 3,000 in the UK.
Most recently, GFG has received a winding up order from HM Revenue & Customs against four of its steel businesses in England over a £26.3m debt.
Last year, Business Secretary Kwasi Kwarteng’s refused to grant Liberty Steel - owner of steelworks in Scotland at Dalzell and Clydebridge - a £170m bail out, as he was unable to ensure money provided would stay in the UK.
The Business, Energy and Industrial Strategy committee published a report into the governance of GFG, casting doubt on whether Gupta was a “fit and proper person” to receive government support, unless he restructured the business “into a more acceptable corporate structure and publishes consolidated accounts that are adequately audited”.
GFG's acquisition of the aluminium smelter, which included a 14,000 acre estate that takes in part of Ben Nevis, has come under scrutiny after it emerged the deal was underwritten by a £586m Scottish Government guarantee to buy energy from the hydro plants.
The deal means the Scottish Government has “significant control” over the Alvance business, which has been operating at Fort William since 1929.
The Scottish Government continues to insist it was “undoubtedly the correct decision” to back the deal, with a spokesperson stating that GFG has launched a “restructuring and transformation committee” in the wake of the SFO investigation.
“The Lochaber businesses are aware of their obligations in respect to account filing”, read the statement. “GFG has been undertaking activity to enhance corporate governance, including the creation of the restructuring and transformation committee in the UK.
“Providing the financial guarantee to protect jobs in the region, underpin additional investment at the site, and promote industry in Scotland, was undoubtedly the correct decision.”
Although GFG did not provide details of more recent trading, a spokesman told the Press & Journal that the smelter enjoyed “strong earnings performance last year” on the back of a robust global price for aluminium, which in turn “provides a good platform” for GFG’s plans to develop a recycling and billet casting plant in Fort William.
The Unite union has also confirmed that workers at the plant have struck a three year pay deal, underlining ongoing demand for the company’s product.
GFG’s spokesman added: “We are pressing on with front end design and engineering work and working with the local chamber of commerce to overcome a housing shortage so we can develop local talent for our skilled, long-term jobs.”
The smelter employs around 200 people, up 40 since 2016 according to the Scottish Government, but far short of the 2,000 jobs Gupta pledged to create when he bought the facility.
Rennie demanded more transparency from both the GFG and the Scottish Government. “We need openness from the company about the future of the jobs and the plant and we also need honesty from the Scottish Government on the exposure to taxpayers following the multi-million pound government financial guarantee
“We have had next to nothing in return for that guarantee and the promised 2,000 jobs have not materialised,” he added. “We need the SNP government to be straightforward now.”
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