RG Steel, creditors eye agreement on sale process

Associated Press//June 21, 2012//

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WILMINGTON, Del. — RG Steel LLC says it is close to resolving differences with creditors over plans to sell the bankrupt steelmaker’s assets.

RG Steel, the nation’s fourth-largest flat-rolled steel manufacturer, sought bankruptcy protection in Delaware last month, citing liquidity issues attributed to low steel prices and high raw material costs.

A bankruptcy financing agreement with secured lenders who are owed some $450 million and have liens on most of RG Steel’s assets requires a quick sale process, including selling a steel mill in Sparrows Point, Md., by July 27.

But unsecured creditors fear the process is being rushed and say more time might result in higher bids.

An RG Steel attorney told the bankruptcy judge Thursday that the two sides were close to an agreement but still working out the final details.

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