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After a US private equity firm took legal action in the UK to seize control, Sanjeev Gupta is trying to keep a Belgian aluminum plant.

Gupta’s metal group GFG Alliance is the subject of an investigation by the Office of Serious Fraud Refinance After the collapse of its main lender, Greensill Capital, debt exceeded $5 billion.

But the lender of GFG’s Duffel rolling mill outside Antwerp-people familiar with the matter said the company is a private equity firm American Industrial Partners-initiated legal proceedings in the past week.

AIP successfully persuaded the court to appoint the managers of the British holding company that owns the asset. This process may result in the transfer of ownership of the Duffel plant to AIP, the holder of the $59 million debt.

A GFG spokesperson stated that it is “vigorously challenging” the government. GFG added: “A comprehensive refinancing plan for Duffel’s business has been agreed with a major international group, which will allow all creditors of Duffel to be paid in full, and we expect the process to be completed soon.”

AIP did not immediately respond to a request for comment.

The lawsuit is the latest A series of legal challenges Gupta had faced creditor this year.This Indian-born industrialist recently Get probation Credit Suisse is a major investor in Greensill’s debt, and the company has previously tried to force some of his companies to close due to outstanding debt. At the same time, GFG stated that it would “fully cooperate” with the SFO investigation announced in May.

The challenge of AIP may complicate the problem Gupta’s recently negotiated rescue loan Commodity trader Glencore is proposing to refinance the debt of its European aluminum business. The London-listed mining and trading company has offered a new six-year loan to refinance part of more than $500 million in debt from the Duffel mine and its French sister plant in Dunkirk.

Earlier this year, AIP acquired all the debts of the Duffel plant and part of the debts of the Dunkirk aluminum smelter, and made an offer to Gupta to purchase these two assets.

In a memo to senior management last week, Gupta confirmed that the group rejected AIP’s bid for these two assets, adding that GFG’s goal is to “use the facilities agreed with Glencore to settle them amicably. Debts”.

However, people familiar with the matter said that this may cause Gupta to maintain control of the French smelter, but transfer control of the Belgian steel mill to the US private equity firm.

Glencore is mainly interested in the Dunkirk aluminum smelter, which is the largest aluminum smelter in Europe, producing 280,000 tons of light metal per year. This transaction will enable Glencore to obtain saleable metals through its large trading arm.

Gupta stated in a memo to employees that GFG has reached an agreement with a London-listed group and competitor Trafigura to supply raw materials to Dunkirk and Duffel, and Glencore will also “assist in product marketing and provide Hedging facilities”.

“These agreements will help ensure the company’s working capital needs and enable us to reduce corporate risk by grasping current strong prices,” Gupta said.

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