GFG Alliance Chairman Sanjeev Gupta has responded to reports that the company has been delaying payment to local contractors owed as much as $500,000, saying his company will develop a Supplier Credit Facility to fast- track payments.
GFG Alliance plan to have all outstanding bills to local suppliers paid by March and in the meantime will work with Greensill, the world’s leading non-bank provider of supply chain finance, to create the SCF.
“This facility will enable us to fast-track future payments, and also alleviate the impact of any increased demands on our suppliers and ensure they can grow with us,” Mr Gupta said.
“The overall aim of the initiative is to improve our payment processes and terms, which will ensure that our suppliers can play a critical role in the long-term growth of our business.
“I can assure you that we fully understood the feelings of those suppliers affected by (these) issues and I am determined we will keep things on track so that we can grow together.”
“If you are interested in finding out more about this program (and potentially participating) please register your interest as soon as possible by emailing email@example.com.”
In a statement released today Mr Gupta said the payment terms and conditions inherited from Arrium when the company was bought had not been changed since that sale.
Mr Gupta said that GFG had also inherited a working capital management system which was ‘not fit for purpose’ from Arrium and was being upgraded by GFG.
“In order to fast track the upgrade of our working capital management systems we have engaged additional consultancy resources to ensure that all our small business vendors have appropriate payment terms,” Mr Gupta said.
The Whyalla News has reached out to a number of businesses affected by the non-payment of bills for comment.