UK news website ITV said on Tuesday that investment firm Midtown Acquisitions LP, controlled by US-based hedge fund Davidson Kempner, is seeking a forced sale of Essar Global Fund Ltd’s (EGFL) shares in Essar Energy Ltd, which owns and runs the Stanlow refinery.

EGFL is the Cayman Island-registered parent of Essar’s various businesses.

The Stanlow refinery, located near Liverpool, produces more than 16% of transport fuels in the UK. It produces 4.4 billion litres of diesel, three billion litres of petrol and two billion litres of jet fuel a year, according to the company’s website. With more than nine million tonnes of crude oil and feedstock processed each year, the refinery is one of the biggest in the UK.

The dispute dates back a few years ago when EGFL was a guarantor to a $450 million loan facility from a clutch of US lenders to Essar Steel Minnesota, a company which was supposed to mine iron ore and make pellets in the same US state.

Midtown Acquisitions, Barclays Plc, Credit Suisse Group AG and Goldman Sachs Group Inc. had provided a secured term loan facility, which EGFL failed to repay after Essar Steel Minnesota filed for bankruptcy in 2016.

Bloomberg said in an October 2017 report that a New York judge had ruled in favour of the creditors, saying Essar owed $172 million plus interest. Midtown took over the claim and was leading global recovery efforts, the report said.

Meanwhile, Midtown is training its guns on Essar’s assets in the UK and has applied to the UK judiciary to accept the debt obligation that was recognized in the US. The ITV report quoted earlier said Midtown is pursuing a forced sale of EGFL’s shares in the Stanlow refinery through the UK high court.

A spokesperson for EGFL said: “Essar Global Fund has been in litigation with Midtown Acquisitions for over two years. The protracted litigation relates to certain funding arrangements extended to Essar Steel Minnesota LLC, an indirect subsidiary of EGFL, that experienced financial difficulties in 2016.”

Essar is appealing the 2017 verdict in the southern district court of New York. The spokesperson said: “EGFL has disputed the basis of the judgment in New York. The matter is still pending for determination by the New York courts.”

The spokesperson said Midtown has issued separate proceedings relating to EGFL’s shares in Essar Energy, which indirectly owns Essar Oil UK, which is in turn the owner of the Stanlow facility. “EGFL is vigorously defending those proceedings, as it continues to pursue its legal remedies in New York with regard to the underlying judgment.

“In any event, EGFL is confident that its dispute with Midtown will be resolved well ahead of any order being issued by the English courts affecting its indirect ownership of Essar Oil UK and that such proceedings will not adversely impact ownership of, or operation at, Essar Oil UK. EGFL is addressing all its liabilities and has repaid over $5 billion of debt in the last one year,” the spokesperson said.

A representative for Davidson Kempner declined to comment for this story.

Essar had bought the Stanlow refinery from Royal Dutch Shell for $350 million in 2011 and it is one of the few remaining assets that the group now owns in the oil and gas business. In 2017, the group sold Essar Oil – which operated a 20mt oil refinery in Gujarat and an extensive fuel retail network – for $12.9 billion to a consortium led by Russian oil giant Rosneft. This company now operates under the Nayara Energy brand in India.