Judge sets hearing for hiring an expert

The bankrupt company needs an expert's valuation estimates before reorganization starts.
AKRON -- The bankruptcy court judge overseeing WCI Steel Inc.'s case has determined that a valuation expert is needed to help her evaluate competing reorganization plans.
The competing plans are being filed by the Warren steelmaker and its secured noteholders.
WCI employs 1,750 workers and filed for Chapter 11 bankruptcy protection in September 2003.
Judge Marilyn Shea-Stonum says in a show-cause order that the expert is necessary "based upon the history of this case."
She has set a hearing for Friday on hiring Arthur Newman of The Blackstone Group for an amount and a time period to be determined. At this time interested parties in the case may appear to argue why the judge should not appoint the expert.
The Blackstone Group, New York, says it is one of the top U.S. private investment firms.
Judge Shea-Stonum has already heard testimony on two competing plans for operating the company. She has written that she'd prefer one consensual agreement among WCI Steel, creditors and noteholders, the United Steelworkers of America and the Pension Benefit Guarantee Corp.
Newman's task list
Newman's job would be to provide an opinion to the court about valuation issues and analyze the company's financial projections, product market, customer base and production facilities.
He'd also analyze the potential impact of a reorganization plan on the company's valuation, and the recoveries of creditors and stakeholders.
In another matter, Judge Kay Woods has granted WCI Steel's application to hire American Appraisal Associates for appraisal services. It will be paid $125,000 to produce a report to estimate the values of real and personal property.
American Appraisal Associates says it is the largest full-service independent valuation consulting firm in the world.
AAA will be paid its usual hourly rate of $200 to $250 for attending meetings, conferences or additional services.
WCI's own reorganization plan would allow the steelmaker to emerge from bankruptcy protection, reorganize its debts and continue to operate under its present owner, New York-based Renco Group. WCI's current management team would remain largely intact under the plan, which has the backing of the United Steelworkers of America.
A group of creditors, which together holds $324 million of WCI's bonds secured by its property, plant and equipment, also wants to buy and operate the mill. The bondholders would invest an additional $40 million in WCI.