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Union: Potential RG auction has been delayed
warren
The potential auction for RG Steel LLC-Warren has been delayed “for a week or so,” according to United Steelworkers 1375 President Darryl Parker.
Parker’s message was posted on the USW 1375 website, saying that was the only information available from the district office. The auction for the Warren site along with RG Steel’s Sparrows Point site in Maryland had been scheduled for Tuesday. The national USW office was not available to comment.
“New information will be forwarded as soon as it is available,” Parker wrote.
RG Steel had until Monday to identify a primary bidder for its properties. But at the end of the business day Tuesday, one had not been listed in the federal court documents accompanying its bankruptcy filing.
RG Steel-Warren reported sales of about $473 million between Nov. 1, 2011, and May 30, 2012. Sales for the six months prior were $558 million.
The financial reports for the various RG Steel facilities were released Monday as part of the federal bankruptcy case.
The Warren facility reported assets of roughly $284 million with liabilities of $950 million.
The building in Warren is valued by the company at $9,001,811. The land adds an additional $1,680,000.
RG Steel-Warren has about $12.5 million in bank accounts and security deposits and roughly $108 million in machinery and inventory, according to the filing.
The largest holder of debt is Wells Fargo Capital Finance, which is owed about $444 million. RG Steel also owes more than $100 million each to Cerberus, The Renco Group Inc. and Severstal North America, according to the filing.
The financial situation regarding the Warren facility also is complicated by several environmental actions that have been taken against it.
The facility was cited twice in 2011, on June 21 and Dec. 15, by the U.S. Environmental Protection Agency for potential violations of the Clean Air Act. The facility also was cited by the Ohio EPA’s solid-waste division Sept. 21, 2011, and by the Ohio attorney general for a hazardous-waste violation June 6, 2011.
The federal violations result from the company’s going beyond maximum air-pollution standards at the Warren site, said Phillippa Cannon, spokeswoman for the U.S. EPA for Region 5, which includes Ohio. The company also failed to install a machine that was required to continuously monitor emissions from the plant.
“Any new owner would be required to install the monitor,” she said.
No fine has been issued yet against RG Steel involving the emission, Cannon said.
The Ohio EPA action involves the solid-waste landfill on the property in Warren, said Mike Settles, spokesman for the Ohio EPA.
They’ve piled their garbage too high, he said.
Ohio EPA has entered into negotiations with RG Steel to fix the issues with solid waste, but the bankruptcy complicates the issue and will transfer to the next owner if the problems are not solved by RG Steel before a sale, Settles said.
“When the company sells, the problems don’t magically go away,” he said.
The Warren plant produced high-strength, high-carbon steel used primarily in the automotive and construction industries, as well as items such as shovels, wheelbarrows and guardrails.
In an emailed statement in June — the last statement the company made regarding the Warren plant — Bette Kovach, RG spokeswoman, said the company no longer was taking orders from customers, and the various divisions of the Warren mill will “wind down as we complete processing current customer orders.”