The business empires of metal mogul Sanjeev Gupta and financier Lex Greensill relied on each other to fuel their growth. But for years executives and advisers close to both employers urged the two men to break away from their businesses, according to people who knew the subject.
They didn’t get it. Now, Mr Greensill’s firm, Greensill Capital, is insolvent and Mr Gupta’s conglomerate, GFG Alliance, is struggling to survive.
Greensill’s implosion has trapped a number of financial firms, including Credit Suisse Group AG, which froze $ 10 billion in funds it manages with the firm. Regulators have taken over supervision of the German Greensill bank after a special audit found suspicious accounts related to Mr Gupta. The move came despite a recent attempt by SoftBank Group Corp., Greensill’s main external investor, to intervene directly with the regulator.
For GFG Alliance, which hosts the Gupta family’s steel, aluminum and energy companies and generates $ 20 billion in annual revenue, its main source of funding suddenly dried up.