Steel city’s great blue hope off Whyalla bidding war shortlist
Two bidders have been picked as the favourites to buy the ailing Whyalla Steelworks after its $2 billion taxpayer-funded bailout. The Premier has headed to the steel city to meet with workers.
The final bidders for the ailing Whyalla Steelworks have been picked, with a front running Australian company left off the list, as production remains halted after its blast furnace was shutdown in April.
Premier Peter Malinauskas has been outlining the details this morning saying the steelworks sale has progressed to a shortlist of two bidders and that there was an upside to the blast furnace not working as “it’s allowed the team to bring forward a whole range of maintenance activities”.
Speaking at Whyalla this morning, the Premier confirmed the two shortlisted bidders were Brisbane-based metallurgical coal business M Resources and Indian multinational steel conglomerate Jindal Group.
But Australian steel giant BlueScope – the company advising the steelworks’ administrators Korda Mentha – was not one of the two finalists, the Premier confirming this morning that BlueScope still had the right to the last offer.
“I have spoken personally to the CEO of BlueScope myself in the last 24 hours, and I thank them for their ongoing partnership and their interest”, Malinauskas said.
“The two shortlisted bidders have put on the table formidable propositions that would see to a major recapitalisation of the pit to port operations here of steelmaking in Whyalla.
“Significant amounts of capital does need to be invested in the steelworks. Let me be clear about this. The work that Korda Mentha have done to stabilise the business has been essential, but it has also exposed just how much capital is required to bring this enterprise back up to an economic, useful life.”
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A BlueScope spokesperson confirmed that the BlueScope-led consortium – comprising Japan’s Nippon Steel Corporation, India’s JSW Steel and South Korea’s POSCO – was “advised by the administrators that it has not been invited to progress to the next stage of the process”.
“As we have consistently said, any decision to make an offer to acquire and develop expanded operations at Whyalla would be subject to appropriate due diligence and the consortium members’ return on investment hurdles. This would include a clear understanding of the commitments to be made by both State and Federal governments,” the spokesperson said.
“The Administrator has confirmed that BlueScope retains its right of last offer under the services agreement – however there remains no obligation on any of the consortium members to make an offer to acquire the Whyalla Steelworks.”
Earlier this year, the BlueScope board rejected a $15 billion takeover offer, labelling it “highly opportunistic”.
Malinauskas said “that’s not to say it’s over” for BlueScope, but “as it stands today” the final two bids are better aligned “strategically” for the steel city’s future.
Malinauskas denied that BlueScope knew something the other bidders did not, saying the company did not have greater access and “the data room has been open to all the major parties”.
BlueScope has right to make the last offer for the major piece of national steel-making infrastructure – the only one of its kind in Australia that can produce long steel products essential in large construction projects and rail lines.
The steelworks was thrust into administration last year after an extraordinary intervention from the state government, which introduced the new Whyalla Steel Works (Charge on Property) Amendment Act 2025, giving it the power to have former owner Sanjeev Gupta removed from operations.
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Since then, the state and federal governments have committed more than $2 billion in taxpayer money to support the steelworks and associated businesses in Whyalla, promising to find a buyer by September this year.
The steelworks’ collapse and the support funding led to the state government abandoning its flagship promise to develop a $593 million green hydrogen project that would have supplied energy to the plant, with the funds instead channelled into the steelworks.
It was expected the steelworks would now be run on gas instead, Treasurer Tom Koutsantonis telling InDaily “gas is going to be king” for the steelworks moving forward.
According to a joint media release from the state and federal governments this morning, the shortlisted bidders have been invited to submit final funding proposals.
More than 70 parties expressed initial interest, that list whittled down to five earlier this year.
Federal Minister for Industry and Innovation Tim Ayres said the Whyalla Steelworks was central to the federal government’s plans to make “the things Australia needs here”.
“This is about keeping Australian steel onshore for decades to come using Australia’s abundant resources and renewable energy to create more value, more jobs and lower emissions,” he said.
“We’re partnering with South Australia and will work with a new owner to modernise Whyalla – investing alongside industry to deliver a modern, low-emissions facility and a stronger industrial future.
“The interest in Whyalla reflects what we already know: this is a strategic, pit-to-port asset with a strong future in iron and steel and it belongs at the heart of a Future Made in Australia.”
But the blast furnace, which powers the industrial facility, remains offline, the Premier this morning saying it was “in a critical stage” and to get it back online would take “six to eight weeks” due to its age and past neglect.
“As frustrating as that seems, it also serves to demonstrate exactly why we need to get off the blast furnace operations and transition to a different type of steelmaking in the electric arc furnace, but also the direct reduction iron facility, which requires gas-fired operations as distinct from operations based on their metallurgical coal,” the Premier said.
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