* Liberty submits bid, says "passionate" about Arrium turnaround
* Administrator says sticking with preferred bidder Newlake, JB (Adds detail on Liberty's revised bid, Newlake reaction, background)
SYDNEY, June 19 (Reuters) - Britain's Liberty House Group said on Monday it submitted a revised bid for troubled Australian steel group Arrium Ltd ARI.AX , after last week conceding defeat to a South Korean private equity syndicate.
"We remain passionate about the opportunity and intend to continue pursuing discussions," Liberty House said in an email to Reuters.
The Seoul-based private equity syndicate led by Newlake Alliance and JB Asset Management was named on June 15 as the preferred bidder over Liberty, and that was thought to be the end of more than a year of Morgan Stanley-led MS.N efforts to provide a financial rescue package to Arrium. Stanley recommended the Newlake and JB Asset consortium to Arrium's committee of creditors, which overwhelmingly supported the South Korean group, according to the steelmaker's financial administrator, KordaMentha.
Arrium collapsed in April 2016 with A$2.8 billion ($2.13 billion) in debt.
Its creditors' committee includes Australian lenders Commonwealth Bank CBA.AX , National Australia Bank NAB.AX , Westpac WBC.AX and ANZ Bank ANZ.AX , which together are owed a combined A$1 billion.
KordaMentha confirmed a revised bid had been submitted by Liberty House, but said administrators continued to deal with the Korean consortium on an exclusive basis.
An official for JB Asset Management declined to comment. An industry source said the consortium was confident Liberty's revised bid would not alter the race.
A separate source said Liberty had "substantially" increased the amount of cash it is prepared to pay for Arrium.
South Australia state has pledged A$50 million to the new owner to help upgrade Arrium's steelworks. The steelworks is the main employer in the town of Whyalla and the political fallout from cutbacks or shutdowns at the plant would be severe.
A spokesman for the South Australia treasurer, Tom Koutsantonis, said the state would work with either group to keep Arrium in business.
Newlake's and JB's bid proposes spending more than A$1 billion on the Whyalla upgrade and on Arrium's mini-mills, steel distribution and iron ore mining divisions. The consortium also plans to build a gas-fired power station to feed the steelworks, which would help combat South Australia's energy shortage.
Newlake has said it will use the Finex steelmaking technology under license from South Korean steelmaker POSCO 005490.KS to revamp the Arrium's main Whyalla steelworks.
The decision to use the technology played a key role in the selection process, according to KordaMentha.
Liberty House, which operates together with commodities and energy conglomerate SIMEC under the $9.4 billion Gupta Family Group (GFG) Alliance, hit the headlines last year when it offered to rescue steel plants owned by Tata Steel UK TISC.NS that were on the verge of shutdown.
Liberty's so-called green metal model is based on using renewable energy to fire furnaces and smelters that recycle local scrap and sell the finished metal to manufacturers.
($1 = 1.3141 Australian dollars)