Sanjeev Gupta exec quits amid Whyalla turmoil

A top executive hired by Sanjeev Gupta has quit and another director stepped down from several board positions as the British tycoon fights to keep his empire alive.

South Australian treasurer Stephen Mullighan has questioned morale within Sanjeev Gupta’s GFG Alliance

One of Sanjeev Gupta’s top energy executives has quit GFG Alliance after 18 months in the role, with another director stepping down from several board positions as the British industrial magnate holds talks with administrators over the failed Whyalla steelworks.

Stefan Hakansson, appointed as GFG’s global head of sustainable energy projects in July 2023, resigned and stepped down from a string of GFG boards in Australia on Monday in the latest shake-up for the one-time steel tycoon.

Mr Hakansson, whose role was renamed to chief clean energy officer, was initially hired to drive Mr Gupta’s carbon-neutral by 2030 target, touted as a wide-reaching program that would transform heavily-polluting industrial manufacturing into a clean energy future.

The green executive was hired to execute solar, wind and green hydrogen projects to decarbonise GFG’s iron and steel operations.

However, progress has stuttered after a series of setbacks at Whyalla and broader global financing woes which have hampered initial visions of the production of green steel in Australia.

British tycoon Sanjeev Gupta

Michael Morley, a former Nyrstar executive headhunted in 2017 to lead the turnaround of Whyalla, has also stepped down from several SIMEC Energy board roles but will remain a director of InfraBuild, regarded as the strongest asset in the Australian GFG empire.

The departures follow Dak Patel, a former chief executive of InfraBuild, resigning as a director of the company on January 25 in order to focus on his family business interests.

Liberty Steel’s head of mergers and acquisitions, Angelo Zavattieri, also left Mr Gupta’s empire in January to take a new role at a rare earths mining company.

GFG confirmed the latest departures in a statement on ­Tuesday.

“Stefan Hakansson has been appointed to a senior executive role at an organisation outside of GFG Alliance and as a result has resigned from his role as chief clean energy officer as well as director roles at GFG Alliance Boards in Australia. Stefan remains a senior adviser to GFG,” a spokesman said.

Mr Morley “recently stepped down from his role at SIMEC Energy Boards, having helped steward SIMEC Energy into its role as an energy procurement company for GFG companies in Australia. Michael remains a Board member of InfraBuild.”

Administrators KordaMentha released a statement on Tuesday saying they were working closely with representatives of Whyalla and the GFG Alliance, including Mr Gupta, who has said the South Australian government was wrong to put Whyalla into administration last week.

Administrator Mark Mentha said “the assistance of these parties and Mr Gupta would be vital to the efficient conduct of the administration” and that discussions to date had been constructive.

South Australian Treasurer Stephen Mullighan weighed in to the crisis on Tuesday, delivering his verdict on the exit of Mr Patel.

“Clearly it seems from the outside that people inside GFG know that the jig is up – certainly when it comes to Whyalla – and they’re best off moving on,” Mr Mullighan told Adelaide’s FiveAA radio station.

The administration, likely sale process and eventual modernisation of the steelworks are being funded by a $2.4bn joint state and federal government support package, with an emergency $50m available for creditors of the steelworks and another $384m on the table to run the operations while they are in administration.

The SA Treasurer was also forced to defend the state’s hydrogen plans, flagging cuts to its Office of Hydrogen Power South Australia, which was established in 2022 to boost the hyped energy technology. “We’ve made it clear that while we’re going to keep the effort going, we are going to substantially scale the effort down,” Mr Mullighan said.

“The Premier said that the hydrogen jobs plan wasn’t cancelled, it’s just deferred to a point in time that the steelworks is back on its feet with a new operator, it’s been recapitalised, and it’s operating ­efficiently. Keeping a more discreet, more modest version of that office together so that we can continue working on those plans with the new operator as they’re found and as they invest in the plant we think is a good thing to do.”

Last week South Australian Premier Peter Malinauskas axed the state’s flagship $593m hydrogen plant amid the financial chaos at the Whyalla steelworks.

It is the fifth major hydrogen project to fall over in barely a year, following decisions by mining and energy giants Fortescue, Woodside and Origin to abandon hydrogen as experimental and expensive.

KordaMentha will hold the first meeting of creditors for OneSteel Manufacturing in Whyalla on Monday. InfraBuild is ringfenced from Whyalla but as a secured creditor is owed at least $100m, including prepayments from delivery of steel billets it buys from the South Australian mill.

InfraBuild’s steel distribution business is Australia’s largest processor and distributor of long steel products through its electric arc furnaces, and produces 1.4 million tonnes of recycled steel.