Court case against chair of Indian steelmaker won't affect Whyalla sale, SA government says

Court case against chair of Indian steelmaker won't affect Whyalla sale, SA government says

A final decision on the sale of the Whyalla steelworks is expected later this year. (ABC News: James Wakelin)

Indian company Jindal Steel is competing with Queensland coal enterprise M Resources to buy the Whyalla steelworks.

Jindal Steel chair Naveen Jindal has been summonsed to appear before an Indian court, according to international media reports.

A decision on the sale of the steelworks is expected later this year, with the SA government saying it will "maintain integrity".

The South Australian government says it is confident the sale process for the Whyalla steelworks will "maintain integrity", despite an Indian court summoning the chair of one of the shortlisted bidders to appear over an alleged coal mining scam.

Indian steelmaker Jindal Steel is competing with Queensland coal enterprise M Resources to purchase the stricken Whyalla steelworks, with a final decision expected later this year.

But Jindal Steel chair Naveen Jindal has been summoned to appear before a Delhi court on July 17, according to reports by Indian newspaper The Hindu and other international media outlets.

The summons follows a lengthy investigation by India's Central Bureau of Investigation into alleged irregularities in the allocation of coal licences in the central Indian state of Chhattisgarh, the Hindu reported.

The government says a decision has yet to be made about the sale of the Whyalla steelworks. (Supplied: GFG Alliance)

It is part of a more than decade-long scandal in India, dubbed "Coalgate", over the former Indian government's sale of coal rights to private enterprises.

A spokesperson for Jindal Steel said the company "has always adhered to applicable laws and regulations, as we would outline to any court hearing".

"The matter referred to is sub judice, and it would not be appropriate to comment further at this stage," the spokesperson said in a statement.

Mr Jindal is also a member of India's lower house representing Prime Minister Narendra Modi's Bharatiya Janata Party (BJP).

South Australian Energy and Mining Minister Tom Koutsantonis said he could not comment on "what's going on in India" but what he had seen of Mr Jindal's work was "first class".

He said the tender process for the Whyalla steelworks would be evaluated "on its merits".

"What's going on in someone's business career somewhere else, that will be dealt with by that country's legal system," Mr Koutsantonis told 891 ABC Adelaide.

"We've been looking at this for a while, we've sought reassurances, but I have to say what we're focused on is the merits of the operation that are currently operational around the world by Jindal."

There is $1.9 billion on the table from the state and federal governments to help the new owner transition the aging Whyalla plant to green steelmaking.

Tom Koutsantonis says the tender process would be evaluated on its merits. (ABC News: Che Chorley)

Mr Koutsantonis said no decision had been made on the steelworks' sale and the two bidders were "very difficult to decide between".

"We've got two exceptionally well credentialed candidates who are running, both very, very well financially backed, both very transparent, both open with us," he said.

"The Jindal group let us know about what was going on in India, the other groups have been very open and honest with us as well.

"We are satisfied the process will maintain integrity."

The South Australian government stripped the Whyalla steelworks from British industrialist Sanjeev Gupta's GFG Alliance in February 2025, citing underinvestment in the plant.

It has since been in the hands of administrator KordaMentha backed by hundreds of millions of dollars in state and federal support.

GFG Alliance purchased the steelworks in June 2017 following the collapse of previous owner Arrium.

Nicola Centofanti is calling on government to ensure due diligence before signing any contracts.

Opposition spokesperson Nicola Centofanti said South Australians do not want to see "history repeat itself".

"We're really calling on the government to do its due diligence before it signs any contract with any of the bidders," she said.

"Because South Australians really don't want a recurrence of what we've seen over the last few years.

"We don't want to be coming back here 10 years on having to discuss the same issues."

The iron-producing blast furnace at the Whyalla steelworks remains offline, with workers preparing one final attempt to restart it.

The ABC reported last week that hundreds of jobs are at risk if the blast furnace permanently closes.