SPOKEN- Episode 11

In this our first SPOKEN edition of 2021, Sanjeev shares his thoughts on the opportunities and challenges for GFG Alliance in the year to come.


Show Transcript:
00:04JUSTINEHello and welcome to ‘Spoken’ – the podcast for GFG Alliance colleagues across the world. I’m Justine Greene and on this bumper first episode of 2021, we’ll be meeting the CEO of LIBERTY Primary Steel and Mining, and hearing from GFG’s new Head of Compliance. Plus, we’ll get the insight on what it’s like working at one of GFG’s mines in Australia. And, of course, we have questions from you, wherever you are around the globe. Joining us first, as always, is Sanjeev Gupta, Executive Chairman of the GFG Alliance, hi Sanjeev – and the question ‘how are you’, has more significance this time?
00:41SANJEEVYes, yes, it’s been, I hope, a once in a lifetime experience. As many people know, I caught Covid over the holiday period. I mean, it’s well behind me now, I’m fully back to normal, undertaking all my duties, but it wasn’t a very pleasant experience. It’s certainly something I would not recommend to anybody to take lightly.
01:04JUSTINEWhat were your symptoms?
01:05SANJEEVI had a fever, and actually that probably was the worst, because I’ve never had a fever in my life, before. So, you know, having a fever for several days and, sort of, heading up to almost 40 degrees was a new experience. I also had a cough, it went to my lungs a little bit, so I had 30% pneumonia in the lungs. But, look, it’s a memory now. It’s all gone. I’m back to normal, fully functioning, doing everything, so yeah. Here we are.
01:36JUSTINEWell, I’m glad you’re now back to full health… Now, I understand you’re joining us from Dubai this time – what are you doing there?
01:43SANJEEVWell, actually, we came for Christmas, New Year break, and then I got Covid, so we got stuck here. And, actually, it’s been quite a good place to work from during this time, because I’ve been obviously going to Germany quite a bit and working across the other parts of the business, especially in Australia as well. So, it’s quite a good central time zone, so it actually works quite well to be based here and working here.
02:07JUSTINEOK well let’s look forward now to the year ahead, what do you see as both the challenges and opportunities for the GFG family in 2021…
02:16SANJEEVPerhaps I’ll say the opportunities first. So, of course, as we all know, we are in a progressed state on our ThyssenKrupp bid, that is our biggest opportunity this year, for sure. If that goes through that will be a transformational change for the steel business, it will be a big, big step. Similarly, other businesses have opportunities, ALVANCE’s looking to grow, SIMEC is looking to do its projects on renewable energy, in Australia, in the UK, in Spain, and various places. This decade will be about the change from carbon to decarbonised sources of fuel, including hydrogen, including using renewable energy and so on. So, that’s something which we’re very keen to lead, it’s been a core part of our mission for a long time, and now, really it comes to its full bloom this year. So, I think that’s really a great opportunity, which will completely differentiate us from our peers, because we’re well ahead of all of them, to really lead the world in terms of our industry on decarbonisation. This year will be pivotal for that, as all the governments focus on this more and more. In terms of challenges, again, actually, the opportunity of decarbonisation is also the biggest challenge, because of course, it’s not trivial. There’s large capital projects required, lots of cooperation required with governments, with various partners. So, that opportunity is also, as always, double-sided. Every challenge is an opportunity and every opportunity has its challenges.   But, also, I’m concerned about the current state of Covid, after getting it, perhaps it influences your mind, I don’t know, in terms of me being even more focused on it. So, I repeat, and I really recommend that everybody takes care. It’s not a pleasant thing to get. I think I got away reasonably lightly, but even that was horrendous. So, I would really recommend that everybody follows all possible precautions. And, as soon as the vaccine is available, in each place, I recommend very highly that everybody takes that on.
04:11JUSTINEI understand that LIBERTY Steel Group’s first operating and financial report is due soon – what can we expect?
04:18SANJEEVYes, so you know, we merged all the LIBERTY Steel companies last year, and hence, as a consolidated group, our first financial statements will be out imminently, which will, of course, give us a reflection of the financial performance and strength of the steel group. But also, all the other objectives the group has, in terms of our strategy, decarbonisation, hydrogen coming to the fore, recycling, you know, renewable energy and so on. Our governance structures, our new board, objectives, with the advisory board, sort of taking that on, and the actual corporate board, with its new members which I’m very proud of. Of course, we have all our executive members, and very pleased that Denise, our global head of HR, is also now part of the corporate board. But, also very proud of the non-exec directors, we already had Ray Horsburgh and Paul Strike, we now welcomed Monica Middleton, who, especially with her background and focus on ESG, I think it’s really– It’s really become a very wholesome board, both in terms of execs and non-execs.
05:21JUSTINEIt is, of course, an important year for Liberty with the potential acquisition of ThyssenKrupp, which we’ve talked about before.
05:27SANJEEVIndeed, indeed. As I’ve said, that’s the biggest step, which I’m really quite excited about. I was in Germany last week, it was a very exciting few days. I met wonderful people, great people with a lot of talent, a lot of passion, which, you know we’ve got a long history of the business, with almost two hundred years, and the technical expertise and the quality position the business has, was– I knew about it of course, but to see it and feel it was really, really quite incredible. The combination of the business really is– will be amazing. We get– You know, we are not strong in automotive, Thyssen is extremely strong, one of the best in the world, so that combination is really amazing. It really makes us a wholesome global steel business. You know, it’s quite remarkable how much synergy there is between the two businesses, to really, to feel that, was amazing. Of course, it is not done yet, by any means. So, you know, nothing changes until it’s done, all our businesses carry on as normal, but the moment it becomes clear that we are going ahead, then you know, we’ll have more intense discussions with the business and how we integrate and how it impacts the different businesses. So, hopefully, by the next podcast, we’ll have an update, fingers crossed.
06:36JUSTINEThanks Sanjeev – and do stay with us, as we have some questions from your colleagues later in the podcast.
06:46JUSTINEOn the line now from Galati, in Romania, let’s welcome Paramjit Kahlon, CEO-LIBERTY Primary Steel and Mining. Hi Paramjit – you joined LIBERTY in the middle of last year. What’s been your impressions of GFG since then?
07:00PARAMJITHi Justine. My impressions, after joining, has been very encouraging and very great, it is one of the fastest-growing companies, and if you look at the last two years, 2019 and 2020, particularly, the rest of the world was either reeling under markets downturn in 2019, and in 2020, we lost, to a pandemic, a good part of it. But GFG Alliance, and particularly LIBERTY Steel, kept consolidating and was on a spree of lots of acquisitions, and the business empire was growing. So, it’s a very growing company, and I’m really encouraged to be part of it.
07:46JUSTINENow Paramjit, the steel business has been in your blood for quite some time. Just give a quick tour through your background…
07:53PARAMJITYeah, I always say that I was born in steel, because after my education, I started in the steel industry as a project engineer, and then I raised through the ranks and ultimately joined the C-suite about 12 years ago, and since then I have been chief Technology Officer, Chief Operating Officer, and then Chief Executive Officer, and my last stint was with ArcelorMittal, where I worked12 years.
08:24JUSTINENow, we always like to get an insight into our senior leaders’ lives – what are your passions outside of work?
08:32PARAMJITI love to read on the net, not books much. I love to know about the world. I’m very passionate about current events. I’m a runner also, I run a lot. And apart from that, whatever I can do to relax myself, to de-stress, like yoga and meditation, just to keep myself up to date and stress-free.
08:59JUSTINESounds like a good plan. Do you ever run competitively?
09:01PARAMJITYeah, last Saturday I completed a half-marathon when I ran about 21.2km.
09:08JUSTINEWow, you are a serious runner. And what will be your main areas of focus for the next few months?
09:13PARAMJITAs we are consolidating lots of businesses, and most of these businesses we are acquiring from the governments or their previous owners, so our main focus is how we make them costs competitive, how we create better margins and costs.   So, the main focus will remain how to reduce the costs, how to increase the efficiencies in each business, how to run fully in the current markets, where we should not lose even one kilogram, and we should produce to maximum capacity , and then last is that we focus on motivating our employees, so that overall, our results are very impressive, whether it’s in Europe or Australia. Motivated employees can contribute a lot to the success of the business, so that’s my philosophy.
10:08JUSTINEWell, it sounds like you’ve got a good work-life balance. Paramjit, thanks very much for joining us, and hope you can join us again on the podcast in the future…
10:15PARAMJITDefinitely, I think this is a wonderful instrument or tool to communicate with colleagues and share our experiences, how we are coping with the different challenges, and how we are growing in these adverse conditions. I think everybody should know that they’re part of a wonderful company and a wonderful group, where leadership is leading by example. So, good to talk to you, again soon.
10:41JUSTINEWell, that’s good to hear. Now, from Romania to South Australia. Let’s get a flavour of what goes on in open cast mining! Joining us from one of LIBERTY’s mines, is Jacqui Higgins, Head of Iron Ore Mines, Jacqui …
10:55JACQUIThanks, Justine. I’m speaking to you from Barngarla Country, in the South Middleback Ranges, here in Whyalla, South Australia. The Barngarla people are the traditional custodians of the place on which we mine and operate here in Whyalla, and I’d like to take this opportunity to acknowledge the Barngarla people and pay my respects to elders past, present and emerging. So how do we actually find ore? We have an experienced exploration team that identify key features and then drill into the earth using very long metal pipes, much like drinking straws, and then pulling them up to test to see if iron is present. And, if the quality of the ore, with a grade, and other materials like silica and alumina are present. Once hematite and magnetite ore are located the mining technical team develop a pit shell, which is a critical factor for safety and for the economics of the pit. For example, it’s like digging a hole in the sand at the beach, if it’s too steep it falls in on itself, too deep, water can come in. The pit shell is then mined, this involves drilling and blasting to loosen the ground and allow the iron ore to be taken by excavators to move the materials from the pit to the port. Our magnetite ore has a lower iron ore content to hematite, so this material is processed by crushing and screening, grinding, and using a technique called magnetic separation, which as it sounds is like using large magnets to separate the particles. It’s then sent to 60 kilometers, via a slurry pipeline, to the pellet plant in Whyalla, which then transforms this material into pellets, either for the blast furnace here in Whyalla, or it’s filtered and dried producing a plus-65 iron ore grade material that can be exported through the port. As we work across a range of locations, we offer our international customers a unique blended fines product of hematite materials called mining fines. To deliver this product, we crush and screen and then beneficiate, or as I like to call it, wash the ore to remove the impurities, before railing the hematite product to our inner and outer huller facilities. Here, these products are blended together to produce a single harmonious fines product. Our product is then exported through the port. To do this, we use shipping barges and are then taken by tug some nine nautical miles offshore to a large vessel called a ‘Cape’, it’s a really big ship, that holds 176 thousand tons of materials, before heading off to our international customers.
13:25JUSTINEWell, a fascinating insight there. Many thanks to Jacqui Higgins in Whyalla. OK next, we’ll be hearing from GFG’s Head of Compliance and we have questions from you for Sanjeev…
13:39JUSTINEBefore we put Sanjeev in the hot seat, let’s hear from Brendan Leddy, GFG’s new Head of Compliance who has ‘just a minute’ to explain  ‘Compliance’ and his priorities, Brendan…
13:51BRENDANHi Justine, thank you for having me. So, I joined GFG Compliance and on my team, I have Thomas Woodward and Tangena Sultana. I’m looking forward to the challenges ahead, working with hundreds of businesses globally to ensure that they comply internally, with industry regulations and policies. Essentially, we want to ensure that all businesses maintain GFG Alliances legal and ethical integrity. Essentially, we want everybody to be doing the right thing in the right way. If GFG Compliance is going to help businesses to achieve this, it means that we need to ensure that businesses have the tools and the guidance to do the right thing. At GFG Compliance, we want businesses to see us adding value.   Growth brings new challenges, new risks, but by working together, all of us, we can provide assurances to both our internal and our external stakeholders, of businesses being conducted properly and safely. Back to you Justine.
14:50JUSTINEOK, now it’s your chance to get a question direct to Sanjeev. Sanjeev is still here with us. Let’s get our first one…
14:57JIMMYHi Sanjeev, it’s Jimmy Kah from Hayange, I am working in the HR department as a recruitment and training manager. What is your vision regarding green rail and ecology as a whole?
15:10SANJEEVI think that all products in steel can be made from decarbonised steel. I think that most products can be made from recycling. And actually, being able to make Europe’s first screen rail is something I’m very proud of, at Hayange. And not only that, actually, in terms of quality, our rail and our blooms which are coming from Ascoval actually surpass any other quality of primary or blooms from integrated plants, which was the conventional wisdom that rails should be made from primary plants, not from recycled steel. But actually, we are doing better in terms of quality, much better in terms of quality than we have ever had from any primary plant. So, that’s something, amazing really how well it’s gone, the fact that we were supported by INCF and are fully approved by INCF is an incredible achievement. So, I think it’s a great achievement for Ascoval and Hayange what they’ve done, and how as we ramp up, the businesses both benefit from this closed-loop, where we will recycle old rail, other forms of scrap, into blooms, which are going into Hayange and being rolled into rail, for us and others.   Given the low carbon footprint, France has, in terms of its electricity grid, it also makes it one of the lowest carbon rails in the world, not just in Europe. That’s the future, it will happen everywhere in Europe, it already is mostly prevalent in the US, for example, it will happen. So yeah, excited that we broke that mold, that we took that first step, it’s something which we’re very proud of, always at GFG, is being ahead of change and bringing that change to the market rather than reacting to it.
16:46JUSTINEThanks for that, Sanjeev, and thanks Jimmy for taking part in the podcast. And here’s one more for you Sanjeev……
16:52PHILIPPEHello Sanjeev, I’m Phillippe Roux, sales manager of Durisotti, your bodybuilder of France. You said a few years ago that you wanted France to become GFG’s hub in Continental Europe. Several acquisitions have taken place. Are you satisfied by the way business has developed in France and do you have further expansion plans you want to share with us?
17:15SANJEEVIt’s amazing, really, isn’t it? 2018, we had virtually no employees in France, and now we have 2500, we have the headquarters of our aluminum business ALVANCE in Paris, it’s incredible how far we’ve come. And, again, despite Covid last year, how well we’ve done in things like Ascoval and Hayange. So, I’m very happy with our progress in France. Some of the downstream business, not Durisotti, Durisotti is doing well, but some of our other downstream businesses have suffered a bit because of the change in the market, especially in the automotive sector, you know some of the trials and tribulations that sector has gone through, and some of the changes from engines to EVs is impacting our business, but we’re committed to those businesses. We have made a lot of effort in terms of new plans, turn around plans, and we will see those through as well.   But, look, overall, France has been a great success and growth ambitions in France? Of course, you know, GFG is always looking for growth, and we are always examining options and we will continue to do so in France as well.
18:16JUSTINEOK thanks Sanjeev and thanks Philippe for your question. We’ll have more questions next time, so if you want to ask Sanjeev a question, do get in touch, we’d love to hear from you – just drop us an email to spoken@gfgalliance.com, that’s spoken@gfgalliance.com.
18:35JUSTINEFinally, Sanjeev, here in the UK we’re in the midst of another lockdown, how is that affecting your plans for both work and travel?
18:42SANJEEVWell, it’s definitely going to impact us. I mean, I got stuck in Dubai because of my Covid, but now that I’m back to normal I would have– I should be home by now.   But with the lockdowns coming, and with travel restrictions and so on, it’s perhaps– And also, the London office is basically non-existent at the moment in terms of people being able to attend there or even being required to attend there. So, in that situation, it has compelled me to stay on longer here in Dubai, it’s not such a bad place. It’s great, I mean the sun is out, so I’m not complaining too much. But it would be always nice to be at your head office and at home. So that’s impacted me personally because I’m now working away, other than London. And, I think, unfortunately, it will impact work as well, because, you know, lockdowns are quite severe, even more in some cases than before. So, if this continues and I do expect it to continue, then it will impact both demand and our ability to operate some plants, same as it did last year. That’s something which we tackled last year, very well, and whatever is thrown at us, whatever comes our way, I have every confidence in my teams everywhere that they’ll be able to handle both health, safety, and also the impact on business extremely well.
19:53JUSTINEThanks as always Sanjeev and we look forward to speaking again in a few weeks…
19:58SANJEEVThank you, Justine. A pleasure as always, thank you.
20:00JUSTINEAnd when we do return soon, we’ll have all the latest news from the business, including people from around GFG, and of course your questions. Until then, from me Justine Greene and Sanjeev Gupta it’s goodbye.

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SPOKEN- Episode 11
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