STEEL INDUSTRY WCI distributes its financial reorganization plan

The judge urged WCI and its note-holders to resolve their disputes early.
By CYNTHIA VINARSKY
VINDICATOR BUSINESS WRITER
WARREN -- WCI Steel is circulating copies of its plan for reorganizing company finances to emerge from Chapter 11 bankruptcy protection, but the public won't get a peek at the strategy anytime soon.
Lawyers representing the financially troubled Warren steelmaker confirmed Thursday that a confidential draft copy of WCI's reorganization plan has been distributed to attorneys representing lenders, creditors and others involved in the case.
Those same attorneys already have copies of a competing plan proposal, one WCI's secured note-holders started distributing last month. The note-holders are creditors who hold $300 million of WCI's long-term notes.
The note-holders' plan is also confidential, but WCI attorneys have indicated that both plans call for continuing to operate the integrated steel mill, not liquidation.
Similar situation
WCI's situation is shaping up to be similar to what is going on with Weirton Steel in Weirton, W.Va. Weirton's secured note-holders are competing with Cleveland-based ISG for the right to buy the company.
In WCI's case, the creditor group wants a chance to compete, but the company and its parent, Renco Group of New York, have the exclusive right until May 15 to submit a reorganization plan.
"We prefer to remain in charge of the process," said G. Christopher Meyer, part of WCI's legal team, to explain why the company wants to maintain that exclusivity. "We want to preserve what we believe is in the best interest of the estate."
The note-holders have asked federal bankruptcy Judge Marilyn Shea-Stonum to revoke WCI's exclusivity rights so that they can submit a plan as well. They argue that the company is behind schedule and that the note-holders' proposal is the only plan available that will allow WCI to follow its own timetable to emerge from bankruptcy in June.
On schedule?
But Meyer has said company officials think they are on schedule to getting a plan confirmed. "I'm not sure we can hit our June 1 target date exactly, but we can be very close to that. We believe we are following the framework we set out in February."
The judge scheduled a hearing on that issue for 9:30 a.m. May 4 in U.S. Bankruptcy Court in Akron.
In the meantime, Judge Shea-Stonum urged the two sides to work together to try to resolve matters of dispute outside the courtroom.
An ideal solution, the judge said, would be to avoid having competing plans and to emerge instead with a single plan, "one that is the consensus of all."
vinarsky@vindy.com