Judge Approves Sale Of 2 RG Steel Facilities
WILMINGTON, Del. (AP) — A federal judge in Delaware on Wednesday approved the sale of two Ohio facilities owned by bankrupt steelmaker RG Steel LLC.
U.S. Bankruptcy Judge Kevin Carey approved the sale of the company’s Mingo Junction facility for $20 million and its Martins Ferry facility for $22 million.
A hearing on the sales of other RG Steel assets, including a facility in Warren, Ohio, and the Sparrows Point steel mill near Baltimore, is scheduled for next week. An auction for the Sparrows Point mill on Tuesday ended with a concluding bid of $72 million from Hilco Industrial, a company that specializes in industrial liquidations.
Richard Kaye, an executive vice president for Hilco’s holding company, Hilco Trading LLC, declined to comment Wednesday on the auction.
Meanwhile, an attorney for Buffalo, N.Y.-based Frontier Industrial Corp., which submitted a winning bid of $20 million for the Mingo Junction facility, told Carey that parts of the Mingo Junction facility will be demolished, but there is a chance certain operations at the site could continue.
“It’s still in a thought process,” attorney Raymond Fink said.
The prospect that Mingo Junction might continue producing steel was welcomed by members of the United Steelworkers Union who traveled from the Ohio Valley to attend Wednesday’s hearing.
“We feel there’s an opening for us,” said Ernie Gambellin, president of USW Local 1190. ” … That’s why we came today, to put a face on our valley.”
The Martins Ferry facility was purchased for $22 million by businessman W. Quay Mull II and attorney Joseph Gompers, both of Wheeling, W.Va.
According to court records, Esmark Steel Group LLC won the auction for certain assets at RG Steel’s facility in Yorkville, Ohio, with a bid of $4.75 million, which included an agreement to offer jobs to at least 230 employees of the Yorkville facility. Esmark offered an additional $400,000 for mineral interests related to the Yorkville sale.
Steelmaker Nucor Corp. submitted a winning bid of $7 million for certain equipment related to RG Steel’s Wheeling Corrugating division.
Privately held RG Steel is the nation’s fourth-largest flat-rolled steel manufacturer. It sought bankruptcy protection in Delaware in late May, citing liquidity issues attributed to low steel prices and high raw material costs. The bankruptcy filing came a week after RG announced that it would idle factories in Maryland, West Virginia and Ohio and lay off thousands of workers.
(Copyright 2012 by The Associated Press. All Rights Reserved.)