WARREN Judge lets WCI Steel borrow

The loan will bring WCI's liquidity to about $30 million, a spokesman said.
WARREN -- An Akron bankruptcy court judge has conditionally agreed to let WCI Steel borrow $15 million from its parent company, New York-based Renco Group, as part of a loan package it needs to restructure.
WCI spokesman Tim Roberts said Judge Marilyn Shea-Stonum is expected to officially approve the loan, which is called Debtor in Possession or DIP financing, by Friday.
The judge agreed to postpone the filing to give a Pension Benefit Guaranty Corp. representative time to review the financing agreement. The PBGC is a federal agency that insures 35,000 private-sector pension plans, including WCI's pension plan.
Secured financing
WCI secured a $100 million in DIP financing from Congress Financial Corp. and Bank of America in October, about a month after the Warren steelmaker filed for Chapter 11 bankruptcy protection. Roberts said the new $15 million loan will bring WCI's liquidity to about $30 million.
DIP loans are designed to give struggling companies operating capital while they work their way through the bankruptcy process. Lenders are willing to offer DIP financing because, under bankruptcy law, the debtor company must repay it before it pays back other creditors.
Roberts said the company is continuing its meetings with the United Steelworkers of America in Pittsburgh, hammering out proposed contract changes to help WCI reduce operating costs. He said the company's order book remains strong. Officials have said the company aims to emerge from bankruptcy by June.