O’Malley Writes To Sparrows Point Lender
ANNAPOLIS, Md. (AP) — Gov. Martin O’Malley is asking General Electric to help stabilize the financial arrangement that helped build RG Steel in order to prevent layoffs at the company’s Sparrows Point steel plant in Maryland.
In a letter dated Wednesday, O’Malley asked General Electric Chairman and CEO Jeffrey Immelt to personally review the matter.
In April, GE Capital, which provides loans and leases to mid-size and large U.S. businesses, loaned $750 million to support the acquisition of three steel companies from Severstal North America to form RG Steel.
But O’Malley says RG Steel’s liquidity is now unstable, partly because GE and other financing institutions shifted funds needed to support business operations to reserves. The governor says RG Steel feels the decision has frustrated its efforts to improve its liquidity.
(Copyright 2011 by The Associated Press. All Rights Reserved.)