The UK business secretary has criticised the use of “financial engineering” and debt by Sanjeev Gupta’s Liberty Steel as the steelmaker prepares to sell off several plants. Kwasi Kwarteng said there was “healthy interest” and a “viable future” for the UK plants Liberty Steel has put up for sale, in comments to MPs on Tuesday. Liberty Steel has been in crisis since March after the collapse of Greensill Capital, a financier that had lent companies under Gupta’s GFG Alliance banner as much as $5bn (£3.5bn). The collapse has prompted a scramble for new lenders as Greensill’s backers try to recover their money. GFG also faces an investigation into suspected fraud, fraudulent trading and money laundering by the Serious Fraud Office. The inquiry caused a US investor to withdraw from a deal to lend to GFG, reigniting concerns for the future of 35,000 people worldwide, including 3,000 steelworkers in the UK. Liberty on Monday said it would try to sell its Stocksbridge site inSouth Yorkshire and two smaller facilities as part of a restructuring deal it hopes to reach with Credit Suisse, a backer of Greensill. Kwarteng on Tuesday told MPs on the business select committee that he believed there would be buyers for the plants. “The assets fundamentally are good assets, the workforce is skilled and dedicated, the managers of the plant are very experienced,” Kwarteng said. “But the issue that Liberty had […] was to do with financial engineering, the opaque bit, if you like, of GFG. The leverage, the finance, the debt that they had incurred, all of that I think put a lot of pressure on those businesses. “Without that I think there’s healthy interest in the assets and I think they have a viable future.” Kwarteng said steel plants needed owners offering a “more stable structure” rather than a succession of “private equity, financial engineering-type companies who had very little knowledge or experience of managing steel assets”. Government officials have drawn up plans to continue to run Liberty Steel’s UK sites if it falls into liquidation, but Kwarteng turned down a previous request from Liberty for a £170m loan, citing concerns over the opacity of the GFG companies. Kwarteng said his decision had been vindicated by ensuing revelations about various investigations. He said nationalisation of Liberty Steel plants was the least likely option the government would pursue. The Unite union has called for nationalisation to be considered. A spokesperson for GFG Alliance declined to comment.