Oliver GillFri, 2 April 2021, 7:06 pm
Troubled steel tycoon Sanjeev Gupta secured ownership of a 114,000-acre Scottish hunting estate via an offshore company after he acquired it in a deal backed by the taxpayer.
Mr Gupta’s family owns Jahama Highland Estates via an Isle of Man vehicle after he purchased it in a package deal with an aluminium smelter in Lochaber, the area surrounding Fort William.
Nicola Sturgeon’s administration has said that it provided backing for the deal on condition that the assets would not be broken up. Mr Gupta’s GFG Alliance also committed to transferring part of the land to local community ownership, according to local politicians.
Mr Gupta’s activities are under close scrutiny as his empire, which in the UK includes 5,000 workers and crucial steel plants, is threatened with collapse following the failure of its main funder Greensill Capital. He has threatened to take legal action against banks that are racing to recover billions of pounds from his business interests.
Jahama Highland Estates, formerly known as the Alcan Estate after its previous owner Rio Tinto’s aluminium business, boasts “the finest deer stalking ground in Great Britain” alongside hunting for grouse and ducks.
Claiming to have “some of the toughest terrain in the UK”, including the north face of Ben Nevis, the estate was used for special forces training during the Second World War.
GFG acquired the estate in 2016 as part of a taxpayer-guaranteed deal to buy a smelter and associated hydropower plant for £330m from Rio Tinto.
The Scottish government provided a 25-year guarantee, worth an estimated £360m and underpinned by the taxpayers from across the UK, with the promise that up to 2,000 jobs would be created. An alloy wheel factory was planned and then shelved amid claims of a downturn in the car industry.
The SNP forged ahead with the deal despite warnings by advisers to the businesses’ pension scheme trustees that it left UK taxpayers exposed to hundreds of millions of pounds of losses.
Scotland’s rural economy minister Fergus Ewing last month repeated the claim that the taxpayer guarantee that underpinned Mr Gupta’s purchase of the Lochaber smelter prevented separation of the assets. He said: “Our support, which we offered to any bidder with plans for long-term industrial operations of the Lochaber businesses, prevented break-up of the assets.”
The Gupta umbrella under which the former Alcan Estate is now held was in 2019 named as “the biggest property company you’ve never heard of” in the trade press alongside claims that in just two years of deal-making it became Britain’s fifth biggest land owner. The SNP came under pressure in February after a Labour MSP said GFG had not delivered on its commitment to hand part of the estate to locals.
Scottish Conservative finance spokesman Murdo Fraser said: “These revelations add to a growing sense of unease around the terms of the deal struck by the SNP administration.
“We need to know whether this generous taxpayer-funded support was conditional on assets being preserved, as the SNP minister has suggested. If there has been any suspected breach of the terms, he must take whatever steps are necessary to protect public funds.”
Separately, High Court documents reveal that Mr Gupta, “his wife, his three children and two nannies” were forced out of a £100,000-a-month tenancy of a property in Eaton Square, Belgravia, last year after lenders claimed the owner of the property did not have permission to grant the tenancy. Soon after Mr Gupta acquired a mansion on another square nearby for £42m.
A GFG spokesman said: “Jahama works closely with its partners in various parts of Scottish government. Jahama has been described as a beacon of inspiration for landscape-based asset management.”