AKRON Republic sends workers home, shuts operations

Union officials wonder if the company will have money to restart plants.
FAIRLAWN, Ohio (AP) -- Republic Engineered Products LLC, a financially troubled maker of specialty steel bars, apparently has shut down most of its operations.
Republic spokesman John Willoughby would not discuss the situation. He expected a company announcement today. The company sent workers home Thursday and told others not to report for work.
The company, based in this Akron suburb, employs about 2,400 people. It operates steel plants in Canton and Lorain, and value-added rolling and finishing facilities in Canton, Lorain and Massillon in Ohio; Lackawanna, N.Y. and Gary, Ind.
Republic was formed in August 2002 after two investor groups -- KPS Special Situations Fund and Hunt International Group -- paid about $463 million for some assets of bankrupt Republic Technologies International. About 2,000 employees of the former company lost their jobs then.
In default
On Wednesday, the company filed a report with the Securities and Exchange Commission that it is in default on a major bank loan, can't make interest payments on its bonds and expects to default on a $5 million loan from the Ohio Department of Development.
The company had a major setback during the Aug. 14 blackout. An explosion and fire severely damaged its blast furnace in Lorain.
Republic sent home nearly all salaried and union workers Thursday, said Ken Saltz Jr., president of a Steelworkers local at the Massillon cold-finished plant.
Saltz said he was told that workers were being sent home shortly before 3 p.m. and that the company was hoping to have a new loan Monday and to be back in production on Tuesday.
"It's a little scary," said Gary Schleifer, an electrician for 16 years at the cold-finish bar mill in Massillon. "Everything is up in the air. They sounded like they were trying to find money, but who knows if it will happen."
Dash Sokol, president of the Steelworkers local in Lorain, said the company idled much of its production, including its 10-inch and 20-inch bar mills.
"It's not looking good," he said. "It seems like they're in the process of doing an orderly shutdown."
The company sent home most of the Lorain mill's employees, except for those working with the blast furnace and in the basic-oxygen process shop, where the furnace's iron is combined with scrap and lime to make steel.