British firm buys Australian steelmaker Arrium

London-based GFG Alliance has bought Australia's Arrium, the miner and steelmaking giant said Wednesday, ending a tussle with a Korean consortium over the company after it went into voluntary administration last year.

The cash-strapped firm, formerly known as OneSteel when it was spun-off from BHP Billiton in 2000, had struggled with bad debt on the back of plunging commodity prices.

"The administrators and sale advisers Morgan Stanley decided the GFG Alliance offer was superior to the conditional offer of the Korean consortium with whom we were negotiating," Arrium administrator Mark Mentha said in a statement.

He added that the alliance, owned by Britain's Gupta family, had submitted a modified offer late Tuesday.

No further details, including the bid price, were released. Arrium had owed more than Aus$2.0 billion (US$1.5 billion) before its shares were suspended and reported a full-year loss of Aus$1.9 billion in 2014/15.

The agreement is subject to approval by Arrium's committee of creditors and the government's Foreign Investment Review Board, with the sale expected to be completed late next month.

The deal ended 15 months of uncertainty, particularly for the employees of Arrium's steelworks in the South Australian city of Whyalla, and was warmly welcomed by federal and state politicians.

"Getting to this result is great news for Whyalla, it is great news for the Australian steel industry," Treasurer Scott Morrison told reporters in Sydney.

"We have already been in a position to agree the conditions around the Foreign Investment Review Board process and I expect to sign off on that later today."

South Australian Premier Jay Weatherill said he had spoken to businessman Sanjeev Gupta this morning to offer his congratulations and "he reaffirmed his strong commitment to the long-term future of the Whyalla operations".

Arrium operates in 15 countries with 8,350 employees, of which 7,000 are based in Australia, according to the company's website.

GFG is an international energy, metals and industrials group headquartered in London.

Liberty House, which is part of the group, earlier this year bought Tata Steel UK's speciality steel assets for £100 million (US$129 million).

The Korean consortium was led by Newlake Alliance Management and JB Asset Management and was supported by the POSCO company.

The steel sector has been facing headwinds amid global oversupply, while China has been blamed for flooding markets with cheap exports.