(Bloomberg) — In 2017, Sanjeev Gupta was the toast of Whyalla in South Australia, after buying its decades-old steel plant out of administration and announcing a more-than A$1 billion ($777 million) upgrade.His GFG Alliance even sponsored the city’s Christmas pageant, with the steel tycoon and his family following Santa’s sleigh through the streets on a float called the “Gupta Express.” Expectations were ramped up further when Gupta told an audience including Prime Minister Scott Morrison that he planned to build “one of the largest steel plants in the world” in the town.But so far there’s little to show for it. Last June, Gupta said he was going back to the drawing board and would instead “pivot” to a hydrogen-powered green steel plant.That story of planned salvation and stalled delivery has been repeated across Gupta’s steel and aluminum empire. The industrialist, once dubbed the “savior of steel” by the U.K. press, is now hunting for new sources of funding following the collapse this year of his biggest lender, Greensill Capital.Governments are now left contemplating aging assets and the prospect of thousands of job losses. While surging prices for steel and aluminum are helping boost bottom lines for GFG’s businesses, Gupta himself has admitted it’s “constantly a fight” to keep his empire afloat and that “some difficult decisions” may be required.GFG faced little if any competition for many of the plants that it acquired over the years, said Robin Bhar, an independent consultant to the metals industry. “The question is will these then be taken on by the state?”Paul Myners, a member of the House of Lords, said this week that the cost to the U.K. taxpayer of the Greensill collapse, including “having to rescue the steel industry from its savior Mr. Gupta,” could run to 3 billion to 5 billion pounds.GFG disputes the narrative that it over promised and under delivered.Saving JobsThe company “has made significant long-term investments in steel and aluminum plants which were either closed, closing or previously starved of investment,” a spokesperson for GFG said. “In doing so we have saved thousands of industrial jobs that would have otherwise been lost.”In Whyalla, the federal and the South Australian governments were prepared to fund a substantial portion of the steel plant’s upgrade, provided Gupta came up with the remainder of the cash, according to people familiar with the matter. That didn’t happen, said the people, asking not to be identified because that matter is private.GFG said discussions on Whyalla’s long-term transformation were delayed while management focused on operational improvements. A spokesperson for the Federal Australian government declined to comment on GFG, citing the fact that the group is subject to court processes in Australia. The South Australian government did not respond to requests for comment.In 2019, Gupta switched his focus to a debt-funded acquisition of seven steel plants from ArcelorMittal SA. That included the purchase of a Soviet-era steelworks in Romania, which Gupta said he planned to turn into the flagship of GFG’s efforts to be carbon neutral by 2030. In the Czech Republic, he quelled labor union hostility by saying he’d replace old blast furnaces, according to a person familiar with the matter.Heavily IndebtedBoth plants are now heavily indebted, with a combined negative value of $1.6 billion, according to a March 2021 GFG presentation seen by Bloomberg.GFG said improvements to those Eastern European mills were only proposed in 2020 and are still progressing.That playbook — buying unprofitable assets with the plan to of upgrade them, before moving on to the next acquisition — was repeated as Gupta expanded his empire.In 2016 Gupta bought the Lochaber aluminum smelter and an adjacent hydropower plant in the Scottish highlands. The acquisition was backed by an energy-purchase guarantee by the Scottish government, which the metals tycoon securitized through Greensill for cash. The government stepped in to help and Gupta said he would create 1,000 more jobs at the site, partly by building the U.K.’s biggest wheel plant.Three years later GFG scrapped the plan, citing a downturn in the auto industry. Just 44 additional jobs have been created at Lochaber, according to Willie Rennie, a member of the Scottish parliament.A spokesperson for GFG said it had announced plans for a new recycling facility at the site, which would create 70 new jobs and replaces the initial plan.At Gupta’s first ever industrial asset in Newport, Wales, the tycoon said he would expand the mill’s capacity to 2 million tons, while installing a state of the art electric arc furnace. Five years on, production remains in the hundreds of thousands of tons and no new furnace has been installed.Asked about the delay, GFG’s spokesperson said the local unit has hired an equipment provider to develop longer-term plans for development at Newport, which will depend on a competitive investment environment.GFG last month asked the U.K. government for 170 million pounds ($235 million) in funding, but the request was rebuffed. Business Secretary Kwasi Kwarteng told a parliamentary committee last week that it would be “very irresponsible” to give taxpayers’ money to the group.The collapse of Lex Greensill’s eponymous firm in March put pressure on Gupta’s business, which relied heavily on its funding for a years-long acquisition spree.Gupta’s empire, which now spans 30 countries and employs 35,000 people, is left with debt of about $5 billion owed to Greensill, but few of the announced upgrades.As GFG hunts for new funding, Gupta said on a podcast posted April 16 that “it’s constantly a fight at the moment.”The challenge may be made easier, though, by surging steel and aluminum prices that will make the group’s assets more appealing to potential acquirers, said Christian Georges, senior analyst at Societe Generale SA.“Even the low quality ones could find a buyer at low-end price without governments having to step in,” he said. “Some entrepreneurs or financial guys may have a go at it.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.