Paul Barry on the billionaire who failed Whyalla
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I'm Daniel James, and you're listening to 7AM. In 2017, billionaire businessman Sanjeev Gupta rescued the Wyala Steelworks from administration, becoming known as the saviour of steel. There was hope in this small South Australian town that steelmaking, and the thousands of jobs tied to it, would survive. But since then Gupta has lost control. The South Australian government has forced the steelworks into administration and taxpayers are now underwriting the rescue to the tune of $2.4 billion. Now the sale of the steelworks is in its final stages, but the question of whether Wyola becomes the green steel town politicians promised, or whether public money is being used to keep an ageing steelworks alive, remains.
Today we revisit an episode with investigative journalist and former host of the ABC's Media Watch, Paul Barry, on the billionaire who brought Wyola to the brink and what it would really take to save the town. It's Sunday, June 21. This episode was first published in January 2025.
So, Paul, to start with, tell me a bit about Wayala and why the steelworks there are so important.
What led to Sanjeev Gupta being called the savior of Whyalla?
So it's a town that has 22,000 people. It was going to be much bigger. It's kind of like Canberra. It's sort of laid out very spaciously, big wide boulevards, trees down the middle sometimes, lots of brick built public buildings and a very, very friendly town. I just got a beautiful welcome when I went there. Wyala was started back in the 1940s as a shipyard and then in the 60s as a steelworks by BHP.
Industrial development in South Australia takes a big step forward with the opening of a huge 40 million pound steelworks in Wyala.
It's the only steelworks in Australia that makes, the only primary steelworks that makes what's called long steel. And that is girders, rails, the stuff that is used in the building industry. And if you didn't make it at Wyala, you'd basically have to import it.
From these automated smelters and rollers will come the vital steel to feed the hungry growth of Australia's building, car making and engineering industries.
Also, the steelworks is very important to the town. Although only about 1,100 people or 1,000 people now work there, there's something like 4,000 jobs in the town estimated to be dependent on it, and that's not far off half the workforce in Wyala. So if you got rid of the steelworks, if it went bust and wasn't rescued... Wyala's future would be very much in doubt. I don't know what would happen to it.
And now the country's most important new steelmaking plant. And so what did people who you spoke to in Wyala say about their jobs to you? How fearful are they of the future of Wyala?
They're incredibly fearful.
How did the South Australian government intervene in the steelworks situation?
Wyala is old. It's like 60 years old at least. It's desperately in need of investment, desperately in need of maintenance. It went bust back in 2016 when Arium owned it, and it was then rescued after a year in administration. And the guy who bought it, Sanjeev Gupta, was sort of seen as a saviour, and it looked like all the problems were solved.
Uncertainty in terms of the future of this plant is now over. We have a lot of work to do together and a great future ahead, but we need to work together and make changes because this is not currently a sustainable world-class plant. It needs to become one.
Sanjeev Gupta is a British Indian businessman. He started off as a commodities trader. And about 10 years ago, he started up buying steelworks around the world. All these steelworks were losing money. They're all pretty desperate. They're all competing or struggling to compete against the Vietnamese and the Chinese and the Koreans who turned this stuff out in massive quantities much cheaper.
We were not just another company looking to make a quick buck out of a distressed opportunity. It's first and foremost a family business and I regard this as part of my family.
Essentially what this guy Sanjeev Gupta promised in Wayala was it would all be modernised, it would be expanded, they would use renewable energy, it would make green steel and there would be a magnificent future.
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